Wedbush Reiterates Outperform On Activision Blizzard, Sees 54% Upside
In a research report published Thursday, Wedbush analyst Michael Pachter reiterated an Outperform rating on Activision Blizzard Inc (NASDAQ:ATVI) with a price target of $31, which implies an upside of 54% from current levels.
Pachter wrote, “We continue to believe Activision Blizzard is well positioned for further multiple expansion. Call of Duty sales (packaged goods and DLC) appear positioned for a rebound in Q4 as we fully transition to next-generation consoles, and competition appears much less fierce this holiday; Activision’s Skylanders game and toy sales have reached a cumulative $2 billion, withstood an onslaught from a competitive product, and appear positioned to maintain share this holiday; the number of World of Warcraft subs is increasing earlier than expected; Bungie’s Destiny is well-positioned to be its next $1 billion franchise after a record-breaking launch; and the company is seeing continued margin expansion from digital sales.”
“We value the shares at an above-market multiple of 20x our 2015 EPS estimate of $1.55, reflecting our view of outstanding execution and superior earnings growth.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Michael Pachter has a total average return of 0.7% and a 47.6% success rate. Pachter has a 7.6% average return when recommending ATVI, and is ranked #1781 out of 3377 analysts.