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Is this Large Market Cap Stock target price reasonable for Electronic Arts Inc. (NASDAQ:EA)?

The company in question is, Electronic Arts Inc. (NASDAQ:EA) currently with a stock price of 80.89 (1.40% today). The market cap for Electronic Arts Inc. is 24122.45, and is in the sector Technology, and Multimedia & Graphics Software industry. The target price for Electronic Arts Inc. is 87.04. Currently Electronic Arts Inc. is trading with a P/E of 22.13, and a forward P/E of 19.47. Average volume for Electronic Arts Inc. is 3236.91 and so far today it is 3297216.

Performance in the last year for Electronic Arts Inc. has been 8.02%. For EPS growth, Electronic Arts Inc. has seen a growth of 30.10%, and is looking to grow in the next year to 12.86%. More long term stats show that EPS growth has been 44.00% over the last five years and could be 16.24% for the next five years. Electronic Arts Inc. has seen sales growth quarter over quarter at 5.70%, with EPS growth quarter over quarter at 5.90%. The 20-day simple moving average is 5.60%, with the 200-day simple moving average coming to 16.45%.

Since the IPO date for Electronic Arts Inc. on the 3/26/1990, Electronic Arts Inc. has seen performance year to date to be 16.08%. With Electronic Arts Inc. trading at 80.89, the dividend yield is *TBA, and the EPS is 3.6.

So could Electronic Arts Inc., be undervalued? Well as said before P/E is 22.13. The PEG is 1.36, P/S is 5.4 and the P/B is at 6.46. The P/cash is 7.04, with P/free cash flow at 25.74.

Electronic Arts Inc. ability to deal with debt shows that the current ratio is 2.4, and the quick ratio is 2.4. This is with long term debt/equity at 0.27, and total debt/equity at 0.3.

In terms of margins, Electronic Arts Inc. has a gross margin of 69.50%, an operating margin of 21.20% and a profit margin of 25.90%.Payout ratio for Electronic Arts Inc. is 0.00%. Return on assets come to 17.70% with return on investment coming to 25.90%.

Insider ownership for Electronic Arts Inc., is at 0.50% and institutional ownership comes to *TBA. Outstanding shares are at 302.4. While shares float is 299.34. The float short is currently 6.21%, and short ratio is 5.74.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

About the author

Mark Hines

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