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Is Electronic Arts (EA) A Worthy Stock Investment?

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·2 min read
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  • EA

Jefferies Group, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. In the letter, the fund talked about the Metaverse and discussed some of the key companies involved in this virtual/augmented reality technology. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Jefferies Group, in its Q3 2021 investor letter, mentioned Electronic Arts Inc. (NASDAQ: EA) and discussed its stance on the firm. Electronic Arts Inc. is a Redwood City, California-based video game company with a $36.3 billion market capitalization. EA delivered a -10.58% return since the beginning of the year, while its 12-month returns are up by 4.23%. The stock closed at $126.65 per share on November 24, 2021.

Here is what Jefferies Group has to say about Electronic Arts Inc. in its Q3 2021 investor letter:

"Electronic Arts - EA (Buy, $165): EA is the most intriguing in our coverge group. In our conversations with management, the company seems eager to embrace many of the new technologies we've discussed in this note. Moreover, much of EA's best IP - The Sims, SimCity, Skate, and the sports franchises are well positioned to leverage user-generated content; robust virtual economies; pay to earn mechanics, and brand crossovers. Imagine the home decor opportunities in the Sims, the architectural fun and sharing that SimCity could offer, or the build and share skatepark, skateboards, tattoos, and clothing brand crossovers Skate could provide. Why is it intriguing? Skate and SimCity haven't had a recent title in years. The Sims launched in 2014 and lacks multiplayer. And the sports titles currently lack any mode similar to NBA2K's TheCity. We do think all of this is in the pipeline, but timing remains uncertain."

EA Sports, EA Games
EA Sports, EA Games

Copyright: radub85 / 123RF Stock Photo

Based on our calculations, Electronic Arts Inc. (NASDAQ: EA) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. EA was in 53 hedge fund portfolios at the end of the third quarter of 2021, compared to 56 funds in the previous quarter. Electronic Arts Inc. (NASDAQ: EA) delivered a -10.72% return in the past 3 months.

Disclosure: None. This article is originally published at Insider Monkey.