Electronic Arts (EA) is expected to comfortably exceed its second-quarter fiscal 2024 guidance, driven by strong starts for the new EA SPORTS FC games, as well as overly conservative profit guidance, when the digital games maker reports its results after the close on November 1, according to Wedbush analysts.
In an update to clients, the analysts noted they also anticipate a more pronounced beat on the bottom line as the company phases marketing dollars to future periods.
"We are confident that the re-brand (of FIFA to EA SPORTS FC) drove higher levels of organic interest than had been contemplated by the outlook, driving EPS (earnings per share) upside," the analysts wrote.
Their 2Q estimates are for net bookings of $1.8 billion and EPS of $1.35, above the analyst consensus forecast of $1.774 billion and $1.25, respectively.
Analysts at Wedbush added that they are awaiting details on the Battlefield, College Football, Dragon Age, Marvel, and Star Wars games, among others, with EA needing to justify high levels of investment in its pipeline at some point.
They maintained their ‘Outperform’ rating on EA stock with a 12-month target price of $155 per share.
Shares of Electronic Arts rose 2% to $123.83 in late-afternoon trading on Tuesday and are flat year to date.
Contact Sean at sean@proactiveinvestors.com