Credit Suisse 'Still Waiting' At Zynga

Stephen Ju of Credit Suisse has maintained an Underperform rating on Zynga Inc ZNGA, while lowering the price target from $2.93 to $2.87.

The company reported its 4Q15 results with the bookings and adjusted EBITDA below the estimates, although the bookings beat the guidance. MUPs came in below the estimate, while the conversion rate of 1.67 percent beat expectations.

According to the Credit Suisse report, “Similar to prior quarters' reports, Zynga reported continued deterioration of its monthly active and unique users – the impact of which was offset by increased ARPU and ad monetization.”

Ju expects the company to have a 2H loaded release slate, with Dawn of the Titans and CSR2 having been pushing into 2H to allow for additional beta testing.

Ju mentioned that he was waiting to see “the fruits of Zynga's game development efforts in 2H16.”

The 2016 estimates have been modestly reduced due to the release slate, partly offset by the company’s attempts to monetize its declining MUU base.