Needham & Company Downgrades Electronic Arts (EA) to Hold on CEO Departure and Sales Warning

Needham & Company downgraded Electronic Arts (NASDAQ: EA) from Buy to Hold after news the CEO John Riccitiello will step down and the sales warning.

"We believe Mr. Riccitiello's departure comes after a series of setbacks and underscores the industry’s difficult transition to new platforms, business models and genres," analyst Sean McGowan said. "EA shares may actually trade up on the news, at least initially, on speculation that Mr. Riccitiello's departure could bring some "freshness" to the executive suite. However, with EA trading within 10% of our previously held $20 price target, we are lowering our rating to Hold, as we believe the move and the sales warning could be a sign of tougher challenges ahead."

The firm lowered FY13 EPS from $0.95 to $0.80 and FY14 from $1.25 to $1.15.

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

Shares of Electronic Arts closed at $18.71 yesterday.

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