It could be forgiven, if you thought mobile gaming’s heyday was done. But that was not the case, at least not for Playtika Holding (PLTK), whose mobile gaming chops gave it a lot of new respect with Bank of America analysts. In fact, Playtika got sufficient respect to see its shares upgraded rapidly, and investors took notice. Playtika Holding stock rocketed up over 22% in Wednesday afternoon’s trading.
Bank of America analyst Omar Dessouky, who has a five-star rating on TipRanks, sent the rating on Playtika shares from Underperform clear up to Buy in one fell swoop. Dessouky also hiked the price target, though to nowhere near that radical of an extent, sending it from $6 per share to $6.50 per share. That implies a potential upside of 47.7%, reports noted.
Playtika, Dessouky noted, has some fairly major intellectual property on its side, particularly Caesars Slots and Bingo Blitz, along with “…three of the largest and longest-running franchises in mobile gaming history.” That is a selling point, all right, but Dessouky also noted that the mobile gaming market may be mature, but it is “still growing.” Plus, with a strong overall reputation, any downside risk for Playtika is fairly limited.
New Games Coming Soon
Better yet, this bump comes about a month after word emerged that Playtika is planning one monster spend on mergers and acquisitions (M&A). Over the next three years, Playtika looks to drop $450 million on buying other companies or setting up mergers, and it has three new games already poised to release in its pipeline.
Though the releases will be gradual, and set to hit over the next 18 months, Playtika will soon be host to Disney Solitaire from SuperPlay, Claire’s Chronicles from Wooga, and a slot machine game to be named later. That is particularly good news, as, two years ago, Playtika said it would not release new games until market conditions improved. So, with new games coming out, that condition must have been achieved.
Is Playtika a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on PLTK stock based on three Buys and five Holds assigned in the past three months, as indicated by the graphic below. After a 18.04% loss in its share price over the past year, the average PLTK price target of $8.66 per share implies 62.48% upside potential.
