Electronic Arts (EA) Gains As Market Dips: What You Should Know
Electronic Arts (EA) closed the most recent trading day at $135.76, moving +0.6% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.06%. Elsewhere, the Dow gained 0.59%, while the tech-heavy Nasdaq lost 0.3%.
Prior to today's trading, shares of the video game maker had gained 6.84% over the past month. This has outpaced the Consumer Discretionary sector's gain of 1.83% and the S&P 500's gain of 5.76% in that time.
Investors will be hoping for strength from Electronic Arts as it approaches its next earnings release, which is expected to be February 1, 2022. On that day, Electronic Arts is projected to report earnings of $3.20 per share, which would represent year-over-year growth of 3.56%. Our most recent consensus estimate is calling for quarterly revenue of $2.66 billion, up 11.02% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $7.05 per share and revenue of $7.67 billion, which would represent changes of +22.4% and +23.95%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for Electronic Arts. These recent revisions tend to reflect the evolving nature of short-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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Electronic Arts is currently a Zacks Rank #2 (Buy).
In terms of valuation, Electronic Arts is currently trading at a Forward P/E ratio of 19.15. This valuation marks a premium compared to its industry's average Forward P/E of 17.22.
The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 124, which puts it in the top 49% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Electronic Arts Inc. (EA) : Free Stock Analysis Report
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