Electronic Arts Short-Circuits
In web-based episode 15 of "Understanding an Analyst Call," hosted by yours truly, the "15" is meant to represent the closing price for videogame publisher Electronic Arts (EA) today. Unfortunately for long-suffering shareholders in Electronic Arts (the last console cycle began in 2005), $15 won't be the opening price tomorrow, as the stock has plunged in the after-hours session, after what I deem to be a soft fourth quarter (publishing business, Europe, Star Wars user count) and an unexciting initial guidance range for the fiscal year top and bottom lines.
I am starting to receive inquiries about the thought process behind my negative call on the stock ahead of earnings. Since I am not a suffering shareholder in Electronic Arts, I'll listen to the call later, and I would like to do my best to help you to understand the process of making a pre-earnings call on a stock. As with any stock call prior to an earnings release (and keep in mind, this is not for the faint of heart), I will usually run down the following basic checklist:...443 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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