Needham & Company Upgrades Zynga (ZNGA) to Buy

Needham & Company upgraded Zynga (NASDAQ: ZNGA) from Hold to Buy with a price target of $3.25 following Q3 results which featured encouraging metrics.

Analyst Sean McGowan comments, "ZNGA reported 3Q results that at first looked essentially inline or slightly better than our estimates and consensus. But while some metrics were lower than we expected, we believe the strength in bookings per paying user (ABPU), coming despite a setback in the company's launch of a new poker game, are encouraging enough to signal the turnaround will gain momentum. We have increased our 2014, 2015 estimates slightly, but believe that 2016 could be considerably better than our prior estimate. We upgrade to Buy from Hold, and believe a fair price for the shares would be $3.25, our new target price."

The firm raised FY 2014 EPS from ($0.01) to $0.00 and FY 2015 EPS from $0.01 to $0.02. For FY 2016 the now see EPS of $0.05.

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

Shares of Zynga closed at $2.36 yesterday.

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