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Electronic Arts Inc EA

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Q3 for EA Driven by Increased Player Engagement; Switch Port of Apex Could Drive Further Growth

Neil Macker, CFA Senior Equity Analyst

Analyst Note

| Neil Macker, CFA |

EA posted a decent fiscal third quarter as revenue met and EBITDA slightly beat FactSet consensus. Sports titles remain the key for the firm as the latest versions of FIFA and Madden both saw large increases in player engagement versus last year. Apex Legends continues to gain from the lockdown restrictions as new players grew 30% year over year and management now expects fiscal 2021 net bookings to exceed $500 million, up from the original projections of $300 million-$400 million. We maintain our narrow-moat rating and our $134 fair value estimate.

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Company Profile

Business Description

EA is one of the world's largest third-party video game publishers and has transitioned from a console-based video game publisher to the one of the largest publishers on consoles, PC, and mobile. The firm owns number of large franchises, including Madden, FIFA, Battlefield, Apex Legends, Mass Effect, Dragon’s Age, and Need for Speed.

Contact
209 Redwood Shores Parkway
Redwood City, CA, 94065
T +1 650 628-1500
Sector Communication Services
Industry Electronic Gaming & Multimedia
Most Recent Earnings Dec 31, 2020
Fiscal Year End Mar 31, 2021
Stock Type Classic Growth
Employees 9,800

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