Electronic Arts Inc. (EA): Today's Featured Technology 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 Technology sector lower today making it today's featured Technology laggard. The sector as a whole closed the day down 0.1%. By the end of trading, Electronic Arts fell 59 cents (-3.3%) to $17.53 on average volume. Throughout the day, 6.7 million shares of Electronic Arts exchanged hands as compared to its average daily volume of 5.4 million shares. The stock ranged in price between $17.52-$18 after having opened the day at $17.59 as compared to the previous trading day's close of $18.12. Other companies within the Technology sector that declined today were: BroadSoft ( BSFT), down 32.1%, Procera Networks ( PKT), down 30.4%, Groupon ( GRPN), down 24.3%, and Suntech Power Holdings ( STP), down 16.7%.
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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 $5.31 billion and is part of the computer software & services industry. The company has a P/E ratio of 36.1, above the S&P 500 P/E ratio of 17.7. Shares are up 21.8% year to date as of the close of trading on Wednesday. Currently there are eight analysts that rate Electronic Arts a buy, no analysts rate it a sell, and 12 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 impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including relatively poor performance when compared with the S&P 500 during the past year and weak operating cash flow.

On the positive front, Wireless Ronin Technologies ( RNIN), up 108.8%, Plug Power ( PLUG), up 30.4%, Deltathree ( DDDC), up 30%, and Faro Technologies ( FARO), up 17.6%, were all gainers within the technology sector with VeriSign ( VRSN) being today's featured technology sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the technology sector could consider Technology Select Sector SPDR ( XLK) while those bearish on the technology sector could consider ProShares Ultra Short Technology ( REW).

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