Electronic Arts (EA) PT Raised to $135 at Needham & Company

Needham & Company analyst Laura Martin raised the price target on Electronic Arts (NASDAQ: EA) to $135.00 (from $120.00) while maintaining a Buy rating.

The analyst commented, "EA beat guidance for the 3rd time in the past 4 quarters, reporting FY4Q20 GAAP Net Revenue of $1.39B (up 11% y/y), and GAAP diluted EPS of $1.43 (up 107% y/y). On a Non-GAAP basis, EA reported Net Bookings of $1.2B, down 12% y/y, driven by 11% y/y lower full game downloads and 7% y/y lower live services revenue owing to tough comps from the super-successful launches of both APEX Legends and Anthum in Feb of 2019. COVID-19 quarantine and the absence of live sports are driving all-time-high playing times for EA's Sims 4, Apex Legends, FIFA, and Madden. We believe time spent is highly correlated to in-game spending, which should benefit FY21 results. EA stated that COVID-19 would "forever change how EA creates games", which we believe means more distributed game creation, lower real estate costs, and lower avg employee costs post-COVID."

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