Just two days ago, Glu Mobile Inc. (NASDAQ:GLUU) announced it had entered into a multi-year partnership with global entertainment leader WWE to develop a new wrestling game. The game will be available in 2018 and will feature WWE superstars, such as John Cena and many more, WWE trademarks and logos.
In reaction, Roth Capital analyst Darren Aftahi reiterates a Buy rating with a price target of $3.75, which represents an upside of nearly 43% compared to where the shares last closed.
Aftahi trusts this new partnership is very beneficial to the mobile game developer/publisher, especially considering the new game will be developed by the same team as Tap Sports Baseball (TSB). TSB is one of the company’s most lucrative games historically, with total bookings of $30M over the last year.
The analyst asserts, “We are optimistic about the accretive potential that the WWE game could contribute to FY18 bookings given GLUU‘s recent success of TSB and the loyal fan following the WWE trademark brings with it.” Aftahi adds the sports game announcement brings “greater confidence in our FY18 bookings estimate of ~$318M,” since the new wrestling game “helps diversify GLUU’s game slate and leverage a sports-minded audience of all ages.”
Additionally, the analyst updates on Glu’s upcoming game release schedule and refers to the Beta form of Car Town Racing, which will be launched in the forthcoming weeks in Malaysia, and should be launched worldwide three months later if everything goes well. Aftahi expects the release of Taylor Swift game soon, as well as a zombie shooter game, and, “look[s] for more color on the upcoming 2Q17 earnings call.”
According to TipRanks, a financial engine that measures and ranks analysts’ and bloggers’ performance, Darren Aftahi is ranked #3858 out of #4569 analysts. Aftahi has a 46% success rate and generates an annual yield of -1.9%. However, when recommending GLUU, the analyst earns 4.2% average profit on the stock.
TipRanks analytics show GLUU as a Buy. Based on 5 Wall Street analysts offering recommendations for this share, 3 issue a Buy and 2 maintain a Hold. The 12-month average price target stands at $3.07, making a nearly 17% upside from where the stock is currently trading.