Markets

Activision Blizzard (ATVI) Gains As Market Dips: What You Should Know

An image of a pen on a stock chart
Credit: Shutterstock photo

Activision Blizzard (ATVI) closed at $47.05 in the latest trading session, marking a +1.55% move from the prior day. This change outpaced the S&P 500's 1.58% loss on the day. Elsewhere, the Dow lost 1.99%, while the tech-heavy Nasdaq lost 1.63%.

Coming into today, shares of the maker of "Call of Duty" and other video games had lost 8.89% in the past month. In that same time, the Consumer Discretionary sector lost 5.92%, while the S&P 500 lost 6.62%.

Investors will be hoping for strength from ATVI as it approaches its next earnings release, which is expected to be February 14, 2019. The company is expected to report EPS of $1.30, up 38.3% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $3.06 billion, up 15.78% from the year-ago period.

ATVI's full-year Zacks Consensus Estimates are calling for earnings of $2.61 per share and revenue of $7.46 billion. These results would represent year-over-year changes of +14.47% and +4.28%, respectively.

Any recent changes to analyst estimates for ATVI should also be noted by investors. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.12% lower. ATVI is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note ATVI's current valuation metrics, including its Forward P/E ratio of 17.73. This represents a discount compared to its industry's average Forward P/E of 18.65.

We can also see that ATVI currently has a PEG ratio of 1.29. 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 1.29 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 169, putting it in the bottom 34% 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.

To follow ATVI in the coming trading sessions, be sure to utilize Zacks.com.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Activision Blizzard, Inc (ATVI): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

ATVI

Other Topics

Investing Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More