Electronic Arts Inc. First Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Electronic Arts Inc. (NASDAQ:ERTS) will unveil its latest earnings on Tuesday, July 26, 2011. Electronic Arts Inc. develops and distributes video game software and content across a variety of platforms. How Will PopCap Help Electronic Arts Regain Financial Glory?>>

Electronic Arts Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for a loss of 45 cents per share, a wider loss from the year earlier quarter net loss of 38 cents. During the past three months, the average estimate has moved up from a loss of 47 cents. Between one and three months ago, the average estimate moved down, but has risen from a loss of 54 cents during the last month. For the year, analysts are projecting net income of 47 cents per share, a rise of more than twofold from last year.

Past Earnings Performance: The company met estimates last quarter after beating the forecasts in the prior two. In the fourth quarter of the last fiscal year, the company reported profit of 13 cents per share versus a mean estimate of net income of 13 cents per share. In the third quarter of the last fiscal year, the company beat estimates by 2 cents.

Savvy Investing Tip: Our CHEAT SHEET investing framework recommends only stocks with two straight quarters of earnings growth. Learn More >>

Wall St. Revenue Expectations: On average, analysts predict $502.9 million in revenue this quarter, a decline of 6.7% from the year ago quarter. Analysts are forecasting total revenue of $3.94 billion for the year, a rise of 2.9% from last year’s revenue of $3.83 billion.

Analyst Ratings: Analysts are bullish on this stock with 12 analysts rating it as a buy, one rating it as a sell and 10 rating it as a hold.

Key Stats:

A year-over-year revenue increase in the fourth quarter of the last fiscal year snaps a streak of two consecutive quarters of revenue declines. Revenue rose 11.3% in the fourth quarter of the last fiscal year and fell 15.3% in the third quarter of the last fiscal year and 19.9% in the second quarter of the last fiscal year.

Electronic Arts’ profit in the latest quarter follows losses in the previous two quarters. The company reported a profit of $151 million in the fourth quarter of the last fiscal year, a loss of $322 million in the third quarter of the last fiscal year and a loss of $201 million in the second quarter of the last fiscal year.

Competitors to Watch: Activision Blizzard, Inc. (NASDAQ:ATVI), THQ Inc. (NASDAQ:THQI), Take-Two Interactive Software, Inc. (NASDAQ:TTWO), Microsoft Corporation (NASDAQ:MSFT), KONAMI CORPORATION (NYSE:KNM), Majesco Entertainment Co. (NASDAQ:COOL), Sony Corporation (NYSE:SNE), The Walt Disney Company (NYSE:DIS), and Glu Mobile Inc. (NASDAQ:GLUU).

Stock Price Performance: During April 25, 2011 to July 20, 2011, the stock price had risen $3.47 (16.9%) from $20.54 to $24.01. The stock price saw one of its best stretches over the last year between January 28, 2011 and February 8, 2011 when shares rose for eight-straight days, rising 22% (+$3.30) over that span. It saw one of its worst periods between November 8, 2010 and November 16, 2010 when shares fell for seven-straight days, falling 6.9% (-$1.14) over that span. Shares are up $7.63 (+46.6%) year to date.

(Source: Xignite Financials)

Get Actionable Investing Insights: Check Out Wall St. Cheat Sheet’s newest Feature Trades of the Month!

More from The Cheat Sheet