Activision Blizzard, Inc. (NASDAQ:ATVI) is on watch this morning after Eric Sheridan of UBS hiked his price target on the video game maker to $57 per share from the previous $48 per share. The analyst did so due to more bullish expectations for Activision Blizzard, Inc. (NASDAQ:ATVI) past 2017, the potential for higher margins as digital revenue mix grows, and Activision Blizzard, Inc. (NASDAQ:ATVI)’s slow trend toward engagement and relatively steady monetization from the previous blockbuster hits type business model. Sheridan has a ‘Buy’ rating on the stock.
EPS could grow faster than expected if Activision also takes advantage of the upcoming trend toward augmented reality/virtual reality that would make the company’s massively multiplayer online role-playing games even more addictive and profitable.
What Does The Smart Money Sentiment Say?
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Of the 742 elite funds we track, 61 funds owned $2.78 billion of Activision Blizzard, Inc. (NASDAQ:ATVI) and accounted for 10.40% of the float on December 31, versus 64 funds and $4.24 billion respectively on September 30. In terms of notable individual fund activity, Stephen Mandel’s Lone Pine Capital raised its stake by 20% to 20.64 million shares in the fourth quarter. That position accounted for almost 3.9% of Lone Pine’s 13F portfolio at the end of 2016. Philippe Laffont‘s Coatue Management also inched up its holdings by 2% to 11.73 million shares, good for 5% of the fund’s 13F portfolio on December 31.
The Bottom Line
Activision Blizzard, Inc. (NASDAQ:ATVI) is on watch this morning after UBS hiked its price target on the stock. Although shares of the game maker have already surged 38% year-to-date, the investment bank sees more upside ahead.