Bobby Kotick was just on CNBC. He seemed very optimistic on 2009, despite their earnings forecasts. The past quarter was not great, and even at these levels, buying a consumer stock does not sound appealing.
ATVI does seem to be the best positioned of the video games stocks considering they do have a Blizzard game in the pipeline. I think if they can get Starcraft II out this year, they could have a profitable 2009. Otherwise, I don't know how much more they can milk another Guitar Hero in this environment.
@feelmyring, true, the overall market was down today, with the NASDAQ down 1.61%. But ATVI was down 4.24%, which is more than double the market's loss. Systematic risk is certainly a factor here, but ATVI is falling a bit more than that. I presume there's a lot of profit taking after the recent run-up (valuation selling), rather than anything fundamentally wrong developing.
@Powertrade, Stock could be getting crushed just as a result of the entire market being down. There's a lot of red on my board today. All pain, no joy.
@feelmyring, I started getting bearish on valuation. Looks like it was right as the stock is down 5% at this point. I don't think Vivendi needs to revise the tender for the merger to go through (note ATVI shareholders have not voted on the merger yet). The price is definitely up on the merger development...what a high price may mean is that the market is expecting a higher tender. What this could imply is that Vivendi would be taking a smaller % share of the merged company, which would make sense as the overall market consensus had been that Vivendi was getting more than it should've.
@Alpha, A couple of the analysts I work with think that the current stock price of ATVI is going to lead to a counter offer higher than 27.50. Any thoughts?
ATVI has been trading near 30 for a while now. Is anyone here still holding through the new year? The stock is now well above the tender.
ATVI had some pretty heavy resistance at 23 through the latter part of the year. It took multiple higher guidance revisions and a merger for us to break those levels into the high 20s. Now I think the stock is trading higher based on late comers, which is generally the sign of a top.
I don't think there's much that should bring ATVI above $27.50. The only thing that would move it past that is another surprise bidder coming in. ATVI should hover closely to 27.50 and edge ever closer to it till the deal goes through. I personally would take my gains now, declare victory, and move on, and then maybe give this another look after the deal is done.
Call of Duty at 1.5 million copies sold on the Xbox 360 alone. I think CoD4 is far outpacing what anyone had expected. Anyone think we're going to gap up on ATVI tomorrow?
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ATVI does seem to be the best positioned of the video games stocks considering they do have a Blizzard game in the pipeline. I think if they can get Starcraft II out this year, they could have a profitable 2009. Otherwise, I don't know how much more they can milk another Guitar Hero in this environment.