Zynga (ZNGA): Notes from Investor Meetings - Wedbush
- Wall Street ends down as Trump focuses on trade
- Aetna's (AET) Humana (HUM) Takeover Blocked by Judge as Anticompetative
- Trump signs order withdrawing U.S. from Trans-Pacific trade deal
- Qualcomm (QCOM) Thrashed as Apple (AAPL) Lawsuit Threatens Licensing Business Model
- McDonald's (MCD) Tops Q4 EPS by 3c
Find out which companies are about to raise their dividend well before the news hits the Street with StreetInsider.com's Dividend Insider Elite. Sign-up for a FREE trial here.
FBR Capital analyst, Michael Pachter, reiterated his Outperform rating on shares of Zynga (NASDAQ: ZNGA) and thinks "Zynga is a compelling investment". The company's market cap of $2.5 billion includes $868 million in cash and securities, as well as an estimated $500 million in real estate, leaving an enterprise value of $1.1 billion, or 1.3x consensus FY:17 bookings. The analyst thinks a reasonable multiple is 3x forward bookings, which would value shares at $4.25.
The analyst took ZNGA's CEO, Frank Gibeau, on two days of investor meetings and learned that Mr. Gibeau does not expect the company to expand into new game categories for the foreseeable future. In part, this is due to his reluctance to become reliant upon significant paid acquisition spending for new users. Instead, the focus remains on improving the live services of its existing games, with better social interaction seen as a key element for all Zynga releases going forward. Better live services are expected to eventually lead to better retention and monetization for the existing portfolio, which will in turn reduce Zynga’s reliance on hoping that a new release becomes a hit.
No change to the price target of $4.25
Shares of Zynga closed at $2.85 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Silgan (SLGN) to Acquire WestRock's (WRK) Specialty Closures and Dispensing Systems Business for $1.03B
- UPDATE: Seaport Global Securities Upgrades Columbus McKinnon (CMCO) to Buy
- Xtant Medical Holdings (XTNT) Announces Resignation of CEO Dan Goldberger
Create E-mail Alert Related CategoriesAnalyst Comments, Management Comments
Related EntitiesDefinitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!