March 13, 2019

EA – Market expectations are for Uniform ROA to stabilize near recent peaks, and management is optimistic about growth, their suite of content, and monetization

  • Electronic Arts Inc. (EA:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 22.3x Uniform P/E. At these levels, the market has somewhat bullish expectations for the firm, and management is excited about future growth potential, generating content for communities, and Battlefield and mobile franchises, and is confident about their Apex Legends release, Apex Legends monetization strategies, and sports game revenue growth
  • Specifically, management generated excitement markers when discussing future growth potential and their ability to generate content for their communities. They also generated excitement markers when discussing additions to Battlefield and mobile franchise live services. Moreover, management is confident in their ability to expand fan-favorite franchises, and improve player experience through subscription programs. Additionally, they are confident about early momentum for Battlefield V and the strong response to Apex Legends’ release. Furthermore, they are confident about Apex Legends’ monetization strategies, Madden Ultimate Team growth, and sports game releases
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