Buying opportunity ahead of strong CY18
We reiterate our Overweight stance on EA, seeing recent weakness as presenting a buying opportunity in a company benefiting from numerous industry tailwinds. The fall-out from the Star Wars MTX controversy should be manageable given ongoing strength for Ultimate Team and we expect investors to soon start looking towards re-accelerating EPS growth in CY18. While we trim current year estimates, valuation looks attractive even based on consensus FY19 expectations that look too low.Electronic Arts develops, markets, publishes and distributes games, content and services that can be played and watched on a variety of platforms, including game consoles, personal computers, and mobile phones. The company markets and sells its games and services through digital distribution channels and through retail channels. Digitally, the company's console games and services can be purchased through third-party storefronts. In its games and services, the company utilizes brands that it either wholly own or license from others. The company develops and publishes games and services across genres. Within and alongside its games, the company provides live services, including in-game purchases, downloadable content, and esports.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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