Â© Reuters. BMO Capital cuts Electronic Arts (EA) to Market Perform over ‘sticking around issues’
BMO Capital reduced Electronic Arts Inc (NASDAQ:-RRB- to a Market Perform score (from Outperform) and cut their cost target on the stock to $125.00 (from $150.00) following a choice by the UK Competitors and Markets Authority to obstruct the Microsoft (NASDAQ:-RRB-/ Activision Blizzard (NASDAQ:-RRB- offer.
Experts think this decrease to be “proper offered sticking around issues about EA’s mobile method and basic pressure on computer game costs.”
They composed in a note, “An essential element to our Outperform thesis was debt consolidation in the computer game market. We believe big tech companies aspire to boost computer game offerings. However, we believe the troubled and pricey MSFT/ATVI experience, culminating with a crucial UK rejection, might deter possible suitors from trying huge, multi-billion dollar offers, maybe turning towards more bite-sized, sub-$ 1 billion offers, consequently minimizing the takeout premium developed into EA shares.”
Shares of EA are down 0.90% in premarket trading on Thursday.