Financial analysts from Standard & Poor’s Equity Research and Citigroup have upgraded their advice on giant publisher Electronic Arts shares from “hold” to “buy”, as Wall Street interest begins to build in the next generation consoles.
In a note to investors, S&P Equity Research suggested that Electronic Arts will benefit significantly from the start of the next generation of consoles, presumably referring to the company’s particularly strong support for the Xbox 360, for which EA is planning to debut
Need for Speed Most Wanted, FIFA 06: Road to FIFA World Cup, NBA Live 06, Tiger Woods PGA Tour 06, and
Madden NFL 06 on launch day, November 22.
The company was described as having the “most diversified brand library in the industry” by S&P Equity Research, with titles such as
Madden NFL, FIFA, James Bond, Harry Potter and
Tiger Woods PGA Golf used by the research firm as prominent examples. Many, although not all of these franchises will indeed be appearing on the Xbox 360 this year, as Electronic Arts and other large publishers such as Activision and Ubisoft upgrade current generation titles to the console.
S&P Equity Research’s 12-month target price for the stock is now $60, not unreasonable considering that EA's share price has tended as high as $71.16 over the summer, though it's recently dipped close to $50. In tandem with a similar boost by Citigroup, which predicted a target of $62, the market has responded positively to this upgrade, and the stock’s current price is up 2.73 percent to $52.75 in mid-day trading.
