Activision Blizzard Third Quarter Earnings Sneak Peek

Activision Blizzard, Inc. (NASDAQ:ATVI) will unveil its latest earnings on Wednesday, November 7, 2012. Activision Blizzard is an online, personal computer, console, and handheld game publisher.

Activision Blizzard, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 7 cents per share, a rise of 16.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 4 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 7 cents during the last month. For the year, analysts are projecting net income of 95 cents per share, a rise of 10.5% from last year.

Past Earnings Performance: Last quarter, the company beat estimates by 7 cents, coming in at profit of 18 cents a share versus the estimate of net income of 11 cents a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the second quarter, profit fell 44.8% to $185 million (16 cents a share) from $335 million (29 cents a share) the year earlier, but exceeded analyst expectations. Revenue fell 6.2% to $1.07 billion from $1.15 billion.

Wall St. Revenue Expectations: On average, analysts predict $708.4 million in revenue this quarter, a rise of 13% from the year-ago quarter. Analysts are forecasting total revenue of $4.68 billion for the year, a rise of 4.2% from last year’s revenue of $4.49 billion.

Stock Price Performance: Between September 6, 2012 and November 1, 2012, the stock price had fallen $1 (-8.2%), from $12.23 to $11.23. The stock price saw one of its best stretches over the last year between April 20, 2012 and April 30, 2012, when shares rose for seven straight days, increasing 5.5% (+68 cents) over that span. It saw one of its worst periods between October 17, 2012 and October 23, 2012 when shares fell for five straight days, dropping 2% (-22 cents) over that span.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of three-straight quarters of revenue declines. Revenue fell 1.5% in the fourth quarter of the last fiscal year and 19.1% in first quarter before falling again in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.92 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

Analyst Ratings: With 16 analysts rating the stock a buy, none rating it a sell and four rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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