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EA Hires Uncharted Veteran for Star Wars

Zacks Equity Research

Electronic Arts (EA) is leaving no stone unturned to make its upcoming Star Wars title a blockbuster. EA studio Visceral Games recently hired Amy Hennig of Sony's Uncharted fame as the creative director of the Star Wars project.

Amy Hennig is known as one of the most powerful woman in the gaming industry. She worked for video game developer Naughty Dog for the last 10 years as writer and creative director of the Uncharted series. Hennig has won a couple of Writers Guild of America (WGA) awards for Uncharted 3: Drake's Deception and Uncharted 2: Among Thieves.

Reportedly, she was working on the Uncharted 4 installment, when she left Naughty Dog. EA’s decision to hire a powerful writer and creative persona like Hennig for the all important Star Wars title is a good move, in our view.

EA needs a blockbuster hit to strengthen its competitive position against the likes of Activision Blizzard (ATVI) and Take Two Interactive (TTWO) in the fragmented video game market. As big names such as Battlefield 4 failed to perform per expectations, the company is resting its hopes on the upcoming Star War series.

The company already operates a massively multiplayer online role playing game Star Wars: The Old Republic, which to date has received mixed success, contrary to EA’s expectations.

In 2013, it signed a partnership with Walt Disney (DIS) to develop and publish the Star War games for consoles, PCs, tablets, mobile and more. EA is also set to revive Star Wars Battlefront after a 10-year hiatus in 2014.

We believe EA’s strong digital portfolio and continuing growth in the tablet and smartphone market are the key growth catalysts. We believe the wide array of titles and massive fan following will better equip EA to gain traction in the digital gaming segment than most of its peers.

However, intensifying competition remains a concern. Additionally, higher consumer spending on new consoles may cannibalize software sales in the near term. We, therefore, remain cautious on EA’s fourth-quarter guidance.

Currently, EA has a Zacks Rank #3 (Hold).

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