By
Chimamanda U. Martha
February 13th, 2024
Deutsche Bank analyst Brian Kraft believes that the end of the pandemic will lead to the video game industry outperforming the expectations.
The coronavirus pandemic has shifted positions on the market. Tourism, transportation, and entertainment sectors have significantly suffered while e-commerce, pharmacy, and video gaming have benefited from COVID-19. Speaking of the latter, it continues to strengthen during the second coronavirus wave. As German leading bank Deutsche Bank AG has said, due to ‘stay-at-home behaviors’, major video game publishers ‘have further upside’. And with this in mind, Deutsche Bank has upgraded its rating on Activision Blizzard Inc (NASDAQ: ATVI) stock to a ‘buy’ from ‘hold’.
According to Deutsche Bank analyst Bryan Kraft, the pandemic will further contribute to the success of video gaming ether with amplification of macroeconomic factors or without them. Besides, the analyst believes that the end of the pandemic will lead to the industry outperforming the expectations. Kraft has also said that video game publisher stocks have additional upside potential based on ‘high likelihood’ of revenue growth and upward revision of consensus.
Believing in the potential of the video game industry, Deutsche Bank analyst has upgraded his rating on Activision Blizzard stock to a ‘buy’ from ‘hold’ and raised the price target to $90 from $75. In addition, Kraft has lifted the price target for other stocks in the sector. In particular, he raised the stock price target for Electronic Arts (NASDAQ: EA) to $144 from $125 and Take-Two Interactive (NASDAQ: TTWO) to $200 from $175.
About Activision Blizzard
Activision Blizzard is a U.S. video game holding company based in Santa Monica, California. The company was established in 2008 through the merger of Activision Inc. and Vivendi Games. The company’s products encompass various genres, including first- and third-person action, role-playing, strategy, and ‘match-three’. Notably, Activision Blizzard is one of Fortune’s 100 best companies to work for. Its 9,000 employees are some of the best and brightest talents across entertainment, media and technology.
The company conducts its business through three segments: Activision, Blizzard, and King. Activision is a global developer and publisher of interactive software products and entertainment content for the console platform. Blizzard develops products for the PC platform. King develops and publishes interactive entertainment content and services for the mobile platform.
Since 2015, Activision Blizzard has been one of the stocks that make up the S&P 500 index. As of March 2018, the company was the largest game company in the U.S. and Europe in terms of revenue and market capitalization.
As for ATVI stock performance, it is 47.41% up year-to-date. On Wednesday, it closed 0.10% down, at $81.90. After-hours, it further declined to $81.84 per share. Activision Blizzard market cap has totaled $63.21 billion.