Activision (ATVI) Mirrors EA (EA) Losses

NEW YORK (TheStreet) -- Activision Blizzard (ATVI) dropped 4.2% to $16.58 in Tuesday trading, mirroring rival video game publisher Electronic Arts' (EA) 2.8% loss to $24.13. The latter shed share value in anticipation of its earnings after the bell, average reviews of the newly-released Battlefield 4 and news it had ended its 15-year partnership with Tiger Woods.

EA reported second-quarter earnings of 33 cents, beating expectations by 21 cents, on revenue of $1.04 billion. Analysts surveyed by Yahoo! Finance expected revenue of $976.1 million.

For the seasonally-strong third quarter, EA predicts earnings of $1.22 on revenue of $1.65 billion, below analyst estimates of $1.32 on $1.75 billion. The video game company revised its full-year guidance to $1.25 a share on $4 billion in revenue.

For its most recently reported quarter, Activision reported earnings of 8 cents a share on revenue 42% lower year on year to $608 million. Management expects full-year revenue of $4.25 billion, below consensus of $4.29 billion. The company is slated to report third-quarter results on Nov. 6.

In post-market trading, EA has regained 3.2%, while Activision is unchanged.

TheStreet Ratings team rates Activision Blizzard Inc as a Buy with a ratings score of A-. The team has this to say about its recommendation:

"We rate Activision Blizzard Inc (ATVI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

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