BMO Capital downgraded Electronic Arts (EA) to Market Perform from Outperform with a price target of $125, down from $150. The analyst reduced the stock’s valuation multiple to account for a reduction in implied "takeout premium" owing to the U.K. Competition and Markets Authority’s decision to block the Microsoft (MSFT) / Activision Blizzard (ATVI) deal. The firm also thinks a reduction is appropriate given "lingering concerns" about Electronic Arts’ mobile strategy and general pressure on video game spending. As such, the shares are fairly valued, the analyst tells investors in a research note.
Published first on TheFly
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