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Activision Blizzard, Inc (ATVI) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Activision Blizzard, Inc (ATVI) closed at $96.53, marking a -0.28% move from the previous day. This change lagged the S&P 500's 0.18% loss on the day.

Prior to today's trading, shares of the company had gained 1.53% over the past month. This has outpaced the Consumer Discretionary sector's loss of 0.42% and the S&P 500's gain of 0.04% in that time.

Wall Street will be looking for positivity from ATVI as it approaches its next earnings report date. The company is expected to report EPS of $0.75, down 22.68% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.88 billion, down 9.52% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.78 per share and revenue of $8.79 billion. These totals would mark changes of +8.93% and +4.47%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for ATVI. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.61% higher. ATVI currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, ATVI is holding a Forward P/E ratio of 25.64. For comparison, its industry has an average Forward P/E of 23.07, which means ATVI is trading at a premium to the group.

It is also worth noting that ATVI currently has a PEG ratio of 1.4. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Toys - Games - Hobbies was holding an average PEG ratio of 2.37 at yesterday's closing price.

The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 85, putting it in the top 34% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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