SADIF Analytics Assigns Negative Long-Term Outlook Rating to Electronic Arts Inc
Released on: October 31, 2008, 10:08 am
Press Release Author: SADIF Investment Analytics SA
Industry: Financial
Press Release Summary: SADIF-Investment Analytics SA has applied its StockMarks(tm) stock-rating system to Electronic Arts Inc and produced a research report, rating the company's attractiveness to long-term investors.
Press Release Body: Mira, Portugal - October 31, 2008 - SADIF Investment Analytics SA, today announced the release of a new equity research report covering Electronic Arts Inc (ERTS). The report utilizes SADIF's powerful StockMarks(tm) stock rating system and is required reading for any current or potential Electronic Arts Inc investor.
Report Summary: US-based video game company Electronic Arts reported disappointing fiscal second quarter results on October 29th. The company reported a widening net loss of USD 310M compared to a loss of USD 195M over the same period a year earlier. Electronic Arts has not reported a net quarterly profit since February 2007. Rising research and development costs as well as increased cost of goods sold were the primary reasons behind the weakened results in the second fiscal quarter. Revenues were up almost forty percent when compared to the same period a year earlier. However, the results prompted Electronic Arts to lower its year-end earnings estimates. The company also announced restructuring aimed at increasing profitability, by cutting jobs in the US. The recent volatility in shares of Electronic Arts points to the market uncertainty over whether the company will see weak results in the coming holiday period as consumers tighten spending, or, if consumers will latch on to video games as a relatively cheap form of entertainment. Given EA's uncertain short-term outlook and the speculation surrounding the shares, we should look to the company's long-term underlying fundamentals to aide us in our investment decisions. We can assess EA's long-term performance through the use of the StockMarks framework. EA currently has an overall long-term investment-attractiveness rating (Total StockMark or SMT) of 26, placing the company far below the US market average. This rating ranks EA ninth out of ten when compared to nine of the company's closest US-listed peers, selected on the basis of both similarity of business and market positioning factors such as size.
The complete report breaks down the Total StockMark into its three components - Business, Management and Price, performing a thorough analysis of Electronic Arts Inc for long-term investors.
A summary of the StockMarks(tm) ratings for Electronic Arts Inc is available here: http://sadifanalytics.com/stockmarks/company.php?ticker=ERTS&cod_country=125
The report has been distributed to Reuters, and forwarded to Yahoo Finance and FT.com. It is available under 'Analyst Reports' from these websites or directly from SADIF-Investment Analytics SA at http://sadifanalytics.com/stockmarks/article/hist_article.php?cod_country=125
About SADIF-Investment Analytics SA SADIF-Investment Analytics SA is an independent investment research company covering sixteen different markets and over 12,000 companies. Our StockMarks(tm) system is based on proven investment principles and is designed to drive long-term shareholder returns.
Web Site: http://www.sadifanalytics.com
Contact Details: Company: SADIF-Investment Analytics SA Address: AIBAP, Rua do Matadouro, 3070-436 Mira, Portugal Phone Number: (+351) 231849038 Website: www.sadifanalytics.com Email: press@sadifanalytics.com