Electronic Arts Inc. (EA): Today's Featured Computer Software & Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Electronic Arts ( EA) pushed the Computer Software & Services industry lower today making it today's featured Computer Software & Services laggard. The industry as a whole closed the day up 1.7%. By the end of trading, Electronic Arts fell 57 cents (-3.7%) to $14.85 on average volume. Throughout the day, 6.1 million shares of Electronic Arts exchanged hands as compared to its average daily volume of 5.2 million shares. The stock ranged in price between $14.77-$15.50 after having opened the day at $15.37 as compared to the previous trading day's close of $15.42. Other companies within the Computer Software & Services industry that declined today were: Camelot Information Systems ( CIS), down 8%, Pactera Technology International ( PACT), down 7.7%, TSR ( TSRI), down 6.7%, and FactSet Research Systems ( FDS), down 4.6%.
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Electronic Arts Inc. develops, markets, publishes, and distributes game software content and services for video game consoles, personal computers, mobile phones, tablets and electronic readers, and the Internet. Electronic Arts has a market cap of $4.67 billion and is part of the technology sector. The company has a P/E ratio of 765, above the S&P 500 P/E ratio of 17.7. Shares are down 25.7% year to date as of the close of trading on Monday. Currently there are nine analysts that rate Electronic Arts a buy, no analysts rate it a sell, and 11 rate it a hold.

TheStreet Ratings rates Electronic Arts as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

On the positive front, BOS Better Online Solutions ( BOSC), up 60%, Wireless Ronin Technologies ( RNIN), up 20.9%, Wave Systems Corporation ( WAVX), up 13.2%, and THQ ( THQI), up 13%, were all gainers within the computer software & services industry with F5 Networks ( FFIV) being today's featured computer software & services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the computer software & services industry could consider iShares S&P NA Tech Software Idx ( IGV) while those bearish on the computer software & services industry could consider ProShares Ultra Short Technology ( REW).

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