ZNGA

Zynga Inc

TMT


Presented:05/16/2018
Price:$4.06
Cap:$3.63B
Current Price:$8.18
Cap:$9.30B

Presented

Date05/16/2018
Price$4.06
Market Cap$3.63B
Ent Value$2.64B
P/E Ratio81.2x
Book Value$1.90
Div Yield0%
Shares O/S893.77M
Ave Daily Vol10,406,904
Short Int2.36%

Current

Price$8.18
Market Cap$9.30B
Zynga, Inc. provides social game services. It develops, markets and operates social games as live services played on mobile platforms such as Apple's iOS operating system and Google's Android operating system, and social networking sites such as Facebook. It offers Chess with Friends, Crazy Cake Swap, Draw Something, FarmVille, Gems With Friends, Ice Age: Arctic Blast, Looney Tunes Dash, Speed Guess Something, What's The Phrase, Wizard of Oz Magic Match, Yummy Gummy, Free Slots, Black Diamond Casino, Hit It Rich, Zynga Poker and Willy Wonka Slots. The company was founded by Mark Jonathan Pincus on April 19, 2007 and is headquartered in San Francisco, CA.

Publicly traded companies mentioned herein: Electronic Arts Inc (EA), Facebook Inc (FB), Zynga Inc (ZNGA)

Highlights

The presenter is long Zynga (ZNGA) and believes there is at least 25% upside looking out 12 - 18 months. With co-founder Mark Pincus having collapsed his super-voting shares, and a shift to a single-class share structure, a significant risk has been taken off the table. The recent acquisition of Peak Games’ mobile card game business was CEO Frank Gibeau’s first deal since taking the helm, and it helped smooth out results; additionally, the leverage that comes with exposure to Facebook Instant Games appears to be meaningful. With Q1 2018 revenue and bookings coming in ahead of guidance, he is confident that ZNGA’s top line growth can accelerate by Q4 2018, or Q1 2019. If his thesis is accurate, downside risk should be limited, and there could be optionality around new IP and/or accretive deals.

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Idea Discussion

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