In our fourth edition of the Battle Of The Stocks, we size up two domestic gaming giants: Electronic Arts [EA] and Activision Blizzard [ATVI]. These behemoths account for a significant portion of the gaming market share in the United States.
The United States’ gaming market has been valued at $30.4B in the trailing 12 months prior to June this year. Comparatively, EA has reported sales of $5.1B while ATVI has sales of $7.2B in the same period. These two firmās accounted for over 40% of total gaming revenue in the United States.
EA and ATVI have created significant investor wealth over the past few years. Activision Blizzardās shares have generated absolute returns of 340% while EA stock has risen 348% in the last five years.
But historical gains are not an indicator of future performance. Let us look at the key financial metrics between the two companies and compare them to see which is a better buy at current levels.
Market Cap
Driven by the massive increase in share prices, the market cap or market value of Electronic Arts and Activision have gained significantly over the last few years.
Shares of EA have risen 57% over the last three years and is up 4.2% this year. Comparatively, the ATVI stock has gained 133% in the last three years and up 48% in 2018.
EAās market cap is currently $33B while Activisionās market cap is higher at $59B.
Revenue Growth
Revenue growth is a key indicator to gauge the financial position of any company. Any firm that can grow its revenue will be worth investing in. EA reported sales of 5.18B in fiscal 2018. Analysts expect EAās revenue to grow 1.9% to $5.28B next year, 9.7% to 5.8B in 2020 and 6% to $6.12B in 2021.
Activision Blizzard reported sales of $7.16B last year. According to analysts, the company is estimated to grow sales by almost 7.4% in 2020.
EAās operating margin is expected to be 35% in 2019. ATVIās estimated profit margin is estimated to be higher at 36% in 2019.
WINNER: A Tie
Earnings Growth
While the two companies are looking to improve profit margins, analysts and investors are concerned over the earnings growth potential.
Analysts expect EAās earnings per share (EPS) to grow 14.3% over the next five years. Comparatively, analysts expect Activisionās earnings to rise 15.2% over the next five years.
WINNER: Activision Blizzard
Analyst estimates
We have looked at key financial metrics for the two stocks. Let us now see what Wall Street analysts expect from the two companies. Analysts have a 12-month average target price of $141.15 for EA, indicating an upside potential of 29%.
Comparatively, analysts expect ATVIās share price to rise to $81.11, providing an upside potential of 4.5% over the next year.
I was looking around Google for an old article on tax strategies and this five-year old video of myself happened to pop up.
Iām interviewing a tax expert about how real estate investors avoid paying taxesin perpetuityāAND how everyday citizens can do the same thing.
(Real estateāour TEMPLE I and TEMPLE II projects includedāhas a number of tax benefits savvy investors have capitalized on for years, including Opportunity Zone breaks and 10-year tax abatements.)
Thereās the 1031 exchange, of course, which Iāve shared with you guys before.
Just to refresh your memory, the 1031 Exchange allows you to roll over gains from your last project into a new property TAX FREEāas long as said property is worth the same or more.
But thereās ANOTHER TAX LOOPHOLE that can take your portfolio to an entirely new level by splitting your capital gains into MULTIPLE properties.
PS: In our next update, Iām going to break down how real estate moguls get paid from their propertiesā¦tax free. š PPS: If you want to learn how to implement generational wealth strategies like this one, you can join our NYCE wealth academy (TRIBE U) here.
If thereās anything the pandemic taught us, itās that the paradigm of āofficeā and āworkspaceā has been shaken to its CORE.
Universities are teaching via Zoom, court dates are done virtually, FULLY REMOTE businesses are valued at $1B+, and legitimate Inc. 5000 startups are run fromā¦wherever. š²
This is my office for the dayā¦
I am actually running our business from the beach, typing this from here.
Itās 4:28 pm CET, which means itās 10:28 am EST and I am CRUSHING my to-do list.
(And the team will continue to crush it while Iām asleep. Thatās the š)
Having team members in all the main time zones gives us a 24-hour work cycle vs. 9-5/eight-hour on-the-clock performance.
This means we get 3x the productivity of a similar company. š„
Let me repeat thatā¦3x PRODUCTIVITY vs. our competitors.
Meanwhile our project management software grants us 24-hour TEAM-WIDE connectivity that tracks all tasks and lets us know if productivity dips even a little bit.
There is ALWAYS someone senior awake. It could be Martin in Barcelonaā¦Nat in New Yorkā¦Vineet & Arif in New Delhi.
Well, the first step is to have an actual side hustle youāre launching. Not just an idea, a validated business.
MAJOR KEY: Do NOT spend money until youāve made your FIRST DOLLAR! šššš
(You can catch a replay Business Launch masterclass here and see TRIBE member Nessa launched her business on the spot and got her first $45K client shortly after.)
One of the easiest ways to start is with Airbnbāyou can start that in 10 minutes. Literally. (Hereās a guide if you need it.)
Once you have your business, you build a virtual infrastructure (you really just need two softwares, which are FREE), manage the team accordingly and run the business from there.
Iām gonna put together a step-by-step video breakdown this weekend inside the new TRIBE U on the FIVE key things you need to do this for YOURSELF. šµ š
From what software to use, how to build a team, how to keep.
In the meantime, drop a comment if youāre ready to build some wealth and any questions if you want moreā¦
Letās get to work. š
PS: If you canāt be bothered with video and just wanna get to work, weāre hosting a TRIBE U workshopthat will help you get this process started on the spot. Itās $479 $49. š„
But what does it all really mean? How does it come together? In this week’s chart, our friends at CB Insights break down exactly how blockchain powers Bitcoin.
Warning: count(): Parameter must be an array or an object that implements Countable in /homepages/28/d742565295/htdocs/clickandbuilds/WealthLab/wp-content/themes/zox-news-child/single.php on line 683
You must be logged in to post a comment Login