Citi Maintains 'Buy' Rating on Electronic Arts (ERTS)

May 14, 2008 8:53 AM EDT

Citi maintains a 'Buy' rating on Electronic Arts (Nasdaq: ERTS). Price target $69.

Citi analyst says, "We rate Electronic Arts' shares Buy/High Risk with a target price of $69. Our bullish thesis is predicated on: 1) our belief that now is finally the correct part of the console cycle to own ERTS; 2) fixing internal issues should yield revenue and EPS growth; and 3) its FY09 game lineup is significantly improved vs. FY08 with more new IP launched in over a decade...Update on TTWO Offer - ERTS reiterated that its $25.74 valuation took fully into account the likely success of GTA 4 and that ERTS had anticipated sales in-line with actual. ERTS is working with the FTC and does not believe there is any anti-competitive concern with the proposed transaction though it is waiting on its decision. We believe ERTS is likely to extend its offer past the 5/16 deadline given HSR is unresolved."

Electronic Arts Inc. develops, markets, publishes and distributes interactive software games (titles) that are playable by consumers on devices, such as in-home video game players.[SM]

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