Piper Sandler analyst Michael Olson says that without any "heroic" assumptions, shares of Zynga (ZNGA) have the potential to appreciate over 40% in 18 months. The analyst maintains an Overweight rating on the name with an $8 price target.

Zynga appears poised to benefit from the combination of a strong underlying engine of live services, a growing contribution from new titles, and continued cost containment that should enable further EBITDA margin expansion, Olson tells investors in a research note.

He finds it reasonable to expect ongoing low-double digit bookings growth and several points of annual margin expansion in 2021 and 2022 without any acquisitions.