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Candy Crush IPO Could Go Bazinga! (But It's Probably Another Zynga)

Already, King has seen sequential slowdowns in users and in revenue -- not the sign of a company being built to last. Some writers have also harped on the fact that insiders are removing much of their initial investment in the company by selling shares, in addition to accepting special dividends --though private-equity firms Apax Partners and Index Ventures are keeping such large stakes I'm inclined to give them a pass on that. (Marc Benioff pulled money out of (CRM) pre-IPO, and that turned out OK.) The early signs of slowdown are definitely an issue, Preston said.

"This will definitely force King to answer similar questions that Zynga faced and likely keep investors cautious,'' Preston says.

The last thing is the most obvious -- the DiMaggio Factor.

The one thing anyone remembers about Yankees slugger Joe DiMaggio is that he made a very hard game look easy. So has King. Nearly anyone this side of Bill Gates would trade their commercial accomplishments for what Candy Crush has done in the last couple of years, just as everyone would like to hit one over the left field wall at Yankee Stadium once or twice. Attention should, in fact, be paid.

But the gaming industry isn't easy. It's fickle and hard, and trends change all the time. The only major game maker that's been close to a consistent stock performer is Activision Blizzard (ATVI), the maker of World of Warcraft, just as no one has matched DiMaggio's 56-game hitting streak since 1941.

Can King crush those odds? Maybe (although the unanimity of the skepticism, including mine, is so off-putting it's almost a sign of hope). But the odds are what they are -- and for a $7.6 billion bet, they're pretty steep. If it works, Bazinga! Zacconi and Co. will have outsmarted everyone. But more likely, it's another Zynga.

At the time of publication the author had no position in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Tim Mullaney created the BW Web 20 model portfolio while serving as E-Business Editor of BusinessWeek. He was national economics correspondent at USA Today from 2011 to 2014.
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