BofA/Merrill Upgrades Zynga (ZNGA) Two-Notches to Buy Into Q4 Results; Bookings May Beat Street

February 5, 2013 11:11 AM EST Send to a Friend
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Price: $2.29 --0%

Rating Summary:
    3 Buy, 22 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 23 | Down: 13 | New: 40
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Zynga (Nasdaq: ZNGA) shares are on the rise Tuesday following an upgraded by BofA/Merrill Lynch (BAML) earlier. The firm raised its rating by two-notches from Underperform to Buy, while boosting its price target from $2.70 to $3.40.

BAML said Zynga valuation now represents downside risk. The company has about $2.20 per share in cash and assets, an online poker business which generates $200 million annually, and mobile business that generates about $150 million to $200 million as support for the stock. The firm also said that mobile trends appear to be more stable post-Q3 results, while Q4 bookings might beat guidance (the Street sees annual bookings at $1.09 billion to $1.10 billion).

Zynga will report Q4 results after markets close today. The Street is looking for revs of $212.1 million and a loss of 3 cents per share.

Shares are up about 4 percent in late-morning trading.


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