UPDATE: Needham & Company Upgrades Electronic Arts to Strong Buy, Names $33 PT as 2Q Beats Guidance, Console Refresh is Here

In a report published Wednesday, Needham & Company analyst Sean McGowan upgraded the rating on

from Hold to Strong Buy, and named a $33.00 price target. In the report, Needham & Company noted, “We are upgrading to a Strong Buy with a $33 PT in light of the positive 2Q revenue surprise, impressive opex control, impending console refresh cycle, and longer ‘tails' associated with digital gaming. Looking at the quarter, EA reported 2Q results that far exceed prior guidance as digital revenues grew and cost management remained stringent. NG revenues were $1040mm compared to guidance of $975mm as digital revenues grew 11% YoY. EPS were $0.33 compared to our estimate of $0.11 as the company continues to manage for flat YoY expenses despite the console transition. The company reiterated FY revenue guidance ($4B) but now expects EPS of $1.25 (previously $1.20).” Electronic Arts closed on Tuesday at $24.13.