Electronic Arts (NASDAQ:EA) stock has climbed 4.6% over the past month. Shares regained momentum after the release of its fiscal 2020 first quarter results in late July.
Net income surged to $1.42 billion or $4.75 per share compared to $293 million or $0.95 per share in the prior year. This was largely due to the recognition of a $1.08 billion tax benefit in the first quarter, a number that will total $1.7 billion for the full fiscal year. Still, revenues rose to $1.21 billion in the quarter over $1.14 billion in the previous year.
EA’s Apex Legends property is set for an expansion into the highly lucrative Chinese market. As for its outlook, the company is forecasting revenues of $5.375 billion and GAAP earnings per share of $9.22 for the full fiscal year. It also projects net bookings of $5.1 billion, which are in line with analyst estimates.
Shares of EA are currently trading at the middle of its 52-week range. The stock boasts a price-to-earnings ratio of 12.9 but a high price-to-book of 4.2. Its outlook is promising after a strong first quarter, but as with others in the tech sector the broader economic picture may give investors some pause.
I’m not of that position today. EA stock offers solid value in late August and is worth targeting for growth investors looking for exposure in this space.
