(Photo Credit: jon-e)
Activision Blizzard (ATVI) will report its FQ2 '15 results this afternoon. Wall Street EPS estimates are set at $0.09 and revenue at $666.02M. The Estimize EPS consensus of $0.11 and revenue forecast of $675.84M present slightly more bullish numbers than that of the Street.
Activision Blizzard has performed very well year-to-date (YTD) with a capital return of over 27% relative to the NASDAQ which has posted a gain of 8.07%. Activision's success can be attributed to a number of positives and market commentary seems to suggest that there are more positives to come for shareholders.
Recently, Activision Blizzard added two new members to its board of directors. The first is a former Activision employee and the current CEO of Brynwood Partners, a private equity firm that specializes in consumer goods. The second is the CEO of Wasserman Media Group, a marketing and management agency that specializes in sports and entertainment. Activision Blizzard is hoping that the addition of these two new members to its board will provide some valuable insight into their business.
In terms of their products, Activision Blizzard has a few releases in the pipeline. As revealed at Comic Con in early July, a World of Warcraft movie is currently in production. Although no trailers were released, posters unveiled at Comic Con have peaked both investor and consumer attention. Also, the newest addition to the Call of Duty series, Call of Duty Black Ops 3, is scheduled to be released sometime in the upcoming months. Although these two significant releases will not be reflected in Activision Blizzard's results this afternoon, the hype surrounding each release is likely to help boost the company's underlying share price.
Despite the surge in share price, Activision Blizzard is still trading at a discount to its 5-year historical PE multiple of 21.04X earnings (TTM), it is currently trading at 20.05X. With a whole suite of products being released later this year and other key names such as Starcraft 2 being released in 2016, as well as a solid balance sheet, Activision Blizzard is worth watching after they report this afternoon.
