Video Game Stock Roundup: Game Launches Drive Take-Two, EA and Ubisoft
Over the last five trading sessions, video game stocks mostly witnessed a mixed trend. While new game launches by Take-Two Interactive Software Inc. (TTWO) and Electronic Arts Inc. (EA) made headlines and propelled a positive market sentiment, criticism of Ubisoft Entertainment SA’s (UBSFY) Assassin’s Creed: Unity took a thrashing that affected the overall share price movement of gaming stocks.
Top Stories Over the Last Week
Take-Two Interactive’s wholly-owned subsidiary, Rockstar Games, announced that its flagship game series Grand Theft Auto V is available on PlayStation 4 and Xbox One. Customised for such gaming consoles, the new game includes new First Person Mode, which enhances gamers’ experience and increases chances of attracting new players.
Activision Blizzard (ATVI) declared that its World of Warcraft franchise surpassed 10 million subscribers worldwide as of Nov 13, 2014.Created in 2004, World of Warcraft is a massively multiplayer online role-playing game (:MMORPG) developed by Blizzard Entertainment. It is the most subscribed MMORPG worldwide. (Read more: Activision's World of Warcraft Subscriptions Cross 10M Mark)
Following the launch of Assassin’s Creed: Unity, Ubisoft shares registered a significant decline over the past week. The technical glitches and game bugs resulted in negative reviews and users’ outrage globally. (Read more: Ubisoft's Assassin's Creed: Unity Faces Glitches, Stock Dips)
Electronic Arts’ division, BioWare, launched role-playing game (RPG), Dragon Age: Inquisition, which is currently available in North America. First released in 2009, Dragon Age: Origins became a hit followed by Dragon Age II launch in 2011. The new Dragon Age: Inquisition already remains a winner of Game Critics Award for Best RPG at E3 2014.
Scientific Games Corporation (SGMS) recently received approval for the acquisition of Bally Technologies, Inc. (BYI) from the Nevada Gaming Commission. In August, the company announced its plans for acquiring the slot-machine maker for $3.3 billion in cash. The transaction is expected to close in early 2015.
Performance
The following table shows the price movements of the major video gaming players over both the past five trading days as well as the last six months:
Company | Last 5 Days | Last 6 Months |
ATVI | 5.02% | -12.34% |
EA | 4.05% | 8.05% |
GLUU | -0.26% | -43.59% |
MSFT | -1.16% | 11.65% |
NTES | 2.05% | 23.26% |
TTWO | 2.08% | 13.65% |
ZNGA | -2.89% | -9.18% |
Over the last 5 days, Activision Blizzard and Electronic Arts remained the top gainers with 5% and 4% rise in stock prices, respectively. Notably, the company has been trending up following the earnings release on Nov 6. Notably, both the companies delivered positive news to market, which we believe spurred momentary growth in the stocks.
On the flip side, the stock that lost the most over the five trading sessions has been Zynga, Inc. (ZNGA), which dropped almost 3%.
Over the six-month period, however, NetEase, Inc. gained the maximum — nearly 23.3% — while Glu Mobile, Inc. (GLUU) lost the most registering a decline of 43.6%. We believe growing competition from established players and losing popularity of Glu Mobile’s hit game Kim Kardashian: Hollywood is having a negative impact on the company’s market value.
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