Trade-Ideas LLC identified

Activision Blizzard

(

ATVI

) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Activision Blizzard as such a stock due to the following factors:

  • ATVI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $376.0 million.
  • ATVI has a PE ratio of 34.
  • ATVI is currently in the upper 30% of its 1-year range.
  • ATVI is in the upper 25% of its 20-day range.
  • ATVI is in the upper 35% of its 5-day range.
  • ATVI is currently trading above yesterday's high.
  • ATVI has experienced a gap between today's open and yesterday's close of 0.6%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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More details on ATVI:

Activision Blizzard, Inc. develops and publishes online, personal computer (PC), video game console, handheld, mobile, and tablet games. The company operates through two segments, Activision Publishing, Inc. and Blizzard Entertainment, Inc. The stock currently has a dividend yield of 0.7%. ATVI has a PE ratio of 34. Currently there are 13 analysts that rate Activision Blizzard a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Activision Blizzard has been 8.2 million shares per day over the past 30 days. Activision Blizzard has a market cap of $27.4 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.26 and a short float of 5.3% with 1.86 days to cover. Shares are down 1.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Activision Blizzard as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • ATVI's revenue growth has slightly outpaced the industry average of 8.8%. Since the same quarter one year prior, revenues rose by 13.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, ATVI's share price has jumped by 53.10%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ATVI should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The gross profit margin for ACTIVISION BLIZZARD INC is currently very high, coming in at 83.92%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.09% is above that of the industry average.
  • Net operating cash flow has increased to $309.00 million or 47.84% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 21.84%.
  • ACTIVISION BLIZZARD INC's earnings per share declined by 15.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ACTIVISION BLIZZARD INC increased its bottom line by earning $1.20 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.84 versus $1.20).

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