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Zynga Continues To Erode, Full Year Guidance Not Offered

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In a company report issued on Friday, Credit Suisse lowered its price target on Zynga Inc. (NASDAQ: ZNGA) from $3.24 to 2.92 and maintained its Underperform rating. For the fourth quarter Zynga Inc. reported a net loss of $45.1 million while projecting revenue of $160 million compared to analyst estimates of $197 million.

Regarding the health of the video game company analysts Stephen Ju, Nick Hrynkiewicz, Bo Yang, and Yoni Yadgaran wrote, "Zynga's underlying key performance indicators continued to erode – engagement metrics (MAUs, MUUs, MUPs) all declined while ARPU increased 20% to offset as a more dedicated user base remained to monetize. Management did not offer full year 2015 guidance at this time but did comment that Zynga expects to release 6-10 games during the year, which is a slower pace of release versus what we were expecting."

Management at Zynga Inc. announced the company expects to close their Beijing office by July and eliminate 71 jobs, or about 4% of its workforce. This comes amid slowing demand for social media video games and increased competition by an influx of new companies to the market. Over the past quarter Zynga has lost over 200,000 of its monthly unique payers.

Zynga Inc. closed Thursday at 2.66.

Latest Ratings for ZNGA

Jun 2017Morgan StanleyUpgradesEqual-WeightOverweight
May 2017PiperJaffrayUpgradesNeutralOverweight
May 2017Bank of AmericaUpgradesUnderperformNeutral

View More Analyst Ratings for ZNGA
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Posted-In: Bo Yang Credit Suisse Nick Hrynkiewicz Stephen JuAnalyst Color Price Target Reiteration Analyst Ratings


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