NEW YORK (TheStreet) -- Electronic Arts (EA) - Get Report stock is plunging 8.01% to $64.20 on heavy trading volume on Friday morning after the video game publisher set its fiscal 2016 fourth quarter earnings guidance at 40 cents per share, missing estimates by 10 cent.
After yesterday's market close, the company said it expects revenue to be about $875 million for the quarter that ends March 31, while Wall Street had estimated revenue of $915.41 million.
The current sell-off is "an overly harsh reaction" because of the company's growth potential in fiscal 2017, MKM Partners analysts wrote in a note this morning.
Electronic Arts will release several new titles during fiscal 2017, including "Battlefield 5," "Titanfall 2," "Mirror's Edge Catalyst" and "Mass Effect: Andromeda."
The "near-term headwinds to 4Q in no way detract from a compelling FY17 slate of titles, [an] acceleration in digital revenue next year, and the potential for incremental capital returns," Barclays said in an analyst note earlier today.
So far today, 7.02 million shares of Electronic Arts have exchanged hands, compared with its average daily volume of 4.19 million shares.
Separately, Electronic Arts has a "buy" rating and a letter grade of B- at TheStreet Ratings because of the company's solid stock price performance, largely solid financial position, notable return on equity and expanding profit margins.
You can view the full analysis from the report here: EA
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.