Activision Blizzard (ATVI) Shares Trade Lower on Blizzard Game Pushouts - Stifel

Stifel analyst Drew Crum reiterated a Buy rating and $118.00 price target on Activision Blizzard (NASDAQ: ATVI) after the company reported 3Q results that met consensus assumptions with 2021 guidance unchanged, despite the announcement that both Overwatch 2 and Diablo 4 will require additional development time and NOT be part of next year's line-up. Management indicated both games need additional development time, and cited employee turnover at Blizzard and competition for new hires as the primary causal factor.

The analyst stated "In terms of what it means for estimates and the stock, Overwatch 2 is worth $0.30 as part of our published estimate of $4.51 for '22, and without having either game, the path to growth could be difficult...the company suggested this would, "push out the financial uplift expected for next year". While delays are part of the video games industry, they're typically viewed negatively, even if the long-term benefit outweighs the short-term detriment. And since the Blizzard slate has been a critical piece to the investment thesis here, and this move follows the workplace culture headlines at Blizzard, it's likely to be magnified."

For an analyst ratings summary and ratings history on Activision Blizzard click here. For more ratings news on Activision Blizzard click here.

Shares of Activision Blizzard closed at $77.67 yesterday.

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