5 Reasons to Worry About Next Week: Zynga Inc (ZNGA), The Walt Disney Company (DIS) and More

Zynga is suffering from many of the same crowded marketplace conditions as Glu Mobile, though its rise has come primarily from FarmVille and other freemium games that were originally birthed on social networking websites. Zynga’s a big player in mobile, too. Over the years it has acquired the developers of hot games including Words With Friends and Draw Something.

Investors have learned to steer clear of Zynga. There was plenty of buzz when the company went public 14 months ago, but the shelf life of a hot social game is apparently not too long. Zynga is perpetually under fire to continue to crank out popular playthings, and it hasn’t been able to keep up lately. Bookings have been slipping sequentially, and too many executives bolted as the stock price crashed through 2012.

TriQuint Semiconductor (NASDAQ:TQNT) is a provider of RF solutions and foundry services. Topeka Capital initiated coverage of TriQuint with a hold recommendation last month. Despite the analyst’s fondness for the company’s bulk acoustic wave filter technology, the lack of “significant catalysts to drive revenue and margins” ultimately led to the ho-hum rating.

Finally, we have Exelon. Investors are drawn to the utility provider because of its healthy 6.7% yield, but the real challenge is to grow earnings to keep powering up its payouts. Well, that’s certainly been a challenge here lately. Exelon is expected to post declining profitability for all of 2012 and the same thing can be said for all of 2013.

Why the long face, short-seller?
These companies have seen better days. The market has rewarded many of these stocks with reasonable gains over the past year, but they still haven’t earned those upticks. Lower earnings translates into higher earnings multiples, and nobody wants to see that happen.

The good news here is that Wall Street already expects these companies to deliver shrinking bottom lines. In other words, the bad news is already baked into the shares.

The more I think about it, the less worried I become.

The article 5 Reasons to Worry About Next Week originally appeared on Fool.com and is written by Rick Aristotle Munarriz.

Longtime Fool contributor Rick Aristotle Munarriz owns shares of Walt Disney (NYSE:DIS). The Motley Fool recommends Exelon and Walt Disney. The Motley Fool owns shares of TriQuint Semiconductor and Walt Disney.

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