Honestly, you’d think investors would have taken the news better than this. Video game maker Electronic Arts (EA) rolled out its latest title, “College Football 25,” and the mood was subdued at best. Sufficiently so, in fact, that EA shares were down nearly 4% in Friday afternoon’s trading.
“College Football 25” rolled out to a surprisingly big audience, with 2.2 million unique players already showing up for Early Access and another 600,000 taking on the EA Play trial. This was enough for EA Sports’ General Manager and senior VP Daryl Holt to declare the response “…nothing short of spectacular.”
Indeed, the game packs a lot of football action. With 134 Bowl subdivision colleges available for play and 150 different stadiums complete with current rosters of collegiate players to choose from, the end result is a surprisingly rich experience. The game even has 167 different college fight songs to complete the experience.
So, Why the Plunge?
The question remains, though; why is EA stock in a nosedive after releasing a seemingly popular product? Well, a look at the pipeline might have some answers here. The next game that EA plans to bring out is “Madden NFL 25,” which will be out in mid-August. After that, “EA Sports FC 25” is poised for release in late September. The only non-football game on the roster is “Dragon Age: The Veilguard,” set for release sometime this fall.
That’s not exactly a star-studded lineup, and what is here is mostly derivative of stuff that EA has already released. Sure, there are extra features, and gamers generally approve of the presentation. But still, this is likely an inherently limiting factor. And with EA looking to bring in advertising tech, it’s enough to wonder how these games will be milked for every last dollar.
Is Electronic Arts a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on EA stock based on nine Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 3.62% rally in its share price over the past year, the average EA price target of $153.73 per share implies 8.81% upside potential.
