Goldman Sachs Adds Activision Blizzard (ATVI) to Conviction Buy, "It Pays to Own ATVI"

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ATVI Hot Sheet

Rating Summary:
6 Buy, 4 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
Up: 22 | Down: 8 | New: 36

Goldman Sachs added Activision Blizzard (NASDAQ: ATVI) to its Conviction Buy List with a price target of $16 following results after the close.

The firm said the stock offers compelling total shareholder return story with an 9% cash return yield and increasing visibility into sustainable double digit EPS growth. Also, shares are trading at just 12.5x the firm's new $1.00 2012 EPS estimate (up from $0.97), 6% above its guidance, with several paths of upside to $1.10.

"We believe it pays to own ATVI out of its 4Q print – with an average 8% outperformance in the three months post over the last five years," the analyst said.

They raised 2012/13E EPS to $1.00/$1.12 from $0.97/$1.07 on a lower tax rate and modestly higher World of Warcraft assumptions.

For an analyst ratings summary and ratings history on Activision Blizzard click here. For more ratings news on Activision Blizzard click here.

Shares of Activision Blizzard closed at $12.66 yesterday, with a 52 week range of $10.40-$14.40.

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