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Wedbush Sets Expectations on Three Earnings Plays: Zynga Inc (ZNGA), LinkedIn Corp (LNKD), King Digital Entertainment PLC (KING)

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Wedbush analyst Michael Pachter came out today with a forecast on the gaming app company giant Zynga Inc (NASDAQ:ZNGA), professional networking giant LinkedIn Corp (NYSE:LNKD) and mobile game giant King Digital Entertainment PLC (NYSE:KING), ahead of their upcoming earnings releases.

Zynga Inc

With Zynga preparing to release fiscal third-quarter earnings on Tuesday, November 3, Wedbush’s Michael Pachter reiterated an Outperform rating on the stock, with a $6.00 price target, which represents a potential upside of 153% from where the stock is currently trading.

Pachter noted, “We expect Zynga to exceed consensus estimates driven primarily by its slots games. Our current estimates are for bookings of $170 million and EPS of $(0.01), versus consensus of $170 million and $(0.01), and guidance of $155 – 170 million and $(0.02) – (0.01). We believe that sequential online revenue growth for Hit It Rich! Slots and Wizard of Oz Slots offset any declines in Zynga Poker and the FarmVille games, with any catalog weakness offset by May release FarmVille: Harvest Swap.”

“We expect initial Q4 bookings guidance that is roughly in-line with consensus at the high-end. We expect a range of $175 – 190 million, with modest contributions from expected Q4 releases CSR2, Dawn of Titans, and the new slots title,” the analyst continued.

The analyst concluded, “Notwithstanding our optimism, Zynga is likely to remain a “show me” story until it demonstrates that it can grow bookings. The company must deliver “solid singles” and an occasional double before investors will bid its...


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