Activision Investors Applaud Q4 Report: What The Street Is Saying

Activision Investors Applaud Q4 Report: What The Street Is Saying

Photo courtesy of Activision

Video game maker Activision Blizzard, Inc. ATVI reported fourth-quarter results Thursday that lifted shares to a new 52-week high, while four Street analysts see further upside ahead.

The Activision Blizzard Analysts: Raymond James analyst Andrew Marok maintains an Outperform rating on Activision Blizzard's stock with a price target lifted from $109 to $120.

Needham analyst Laura Martin maintains a Buy rating on Activision Blizzard's stock with an unchanged $102 price target.

Morgan Stanley analyst Brian Nowak maintains an Overweight rating on Activision Blizzard's stock with a price target from $108 to $115.

KeyBanc Capital Markets analyst Tyler Parker maintains an Overweight rating on Activision Blizzard's stock with a price target lifted from $102 to $120.

RayJay Sees Strength In 2021, Beyond: Activision Blizzard's revenue rose 13% year-over-year to $3.05 billion versus the Street’s estimate of $2.83 billion, Marok said in a note.

Revenue from the Activision segment rose 16% to $1.66 billion; King revenue was up 15% at $577 million; and Blizzard’s segment revenue was down 3% at $579 million, the analyst said. 

The company’s core franchises, including Call of Duty, World of Warcraft and Candy Crush, all showed “robust” bookings growth in the quarter, he said.

Momentum should be sustained in 2021 and beyond ahead of multiple launches, including a potential remaster release this year and World of Warcraft mobile titles that are in advanced development, according to RayJay. 

Needham's 5 Key Takeaways: Activision’s earnings report is highlighted by five key takeaways, Martin said in a note.

They are: 

1. The company noted its games reach 400 million players in 190 countries.

2. Throughout 2020, the company had three game franchises that generated $1 billion in net bookings. Management guided toward two additional games hitting the $1-billion revenue milestone.

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