King (KING) IPO Expected Tomorrow; Zynga (ZNGA) Shares Active Early

Zynga (Nasdaq: ZNGA) is active early as more chatter over King Digital Entertainment's (NYSE: KING) appears.

Bloomberg noted Tuesday that King's valuation is about 2.9 times projected sales for 2014. The number comes from King looking to raise $553 million with its IPO, effectively valuing the company at around $7.3 billion.

By comparison, Giant Interactive Group (NYSE: GA) trades for a 6.3 times multiple and Zynga is valuated at 5.1 times. Activision Blizzard (Nasdaq: ATVI) goes for 3.2 times FY14 sales, while Electronic Arts (Nasdaq: EA) is valued at 2.3 times 2014 revenue.

Analysts are cautious on the space as a whole; many believe its very challenging to replicate the success of a hit game and a steep discount should be included with most companies.

King's major game ia Candy Crush, which boasts 97 million daily active users (DAUs). Users generally pay for such items as upgrades and extra lives within the game, which usually run at $1 apiece. Other games from King include Farm Heroes Saga, Bubble With Saga, and PetRescue Saga.

Notably, Candy Crush popularity peaked in July 2013, according to Sterne Agee.

Trading of King shares is expected to start on Wednesday, March 26th. Zynga is up in early trading Tuesday.

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