The Technical Case For Continuing To Love Activision Blizzard, Inc. (ATVI)

A handful of technical analysis tools are suggesting that Activision Blizzard, Inc. (NASDAQ:ATVI) overall gets 88% Sell rating. The stock is also flashing a Sell from the Barchart TrendSpotter trading system. Traders hoping to speculate on the ATVI’s short-term trajectory should know that short terms indicators for the stock averaged 80% Sell with an average daily trading volume over the past 20 days at 14026646 shares. ATVI stock has overall a 0.75% Sell signal considering medium term indicators and the 50-day average daily volume remained almost 10545382 shares. It’s also worth noting that the stock, whose average daily volume over the 100 days prior to this writing was 8521756 shares, is 100% Sell on the basis of long term indicators.

The share price is currently staying around the first support level of $46.33. Below this, the next support is placed in the zone of $44.51. Till the time, the ATVI stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 32.14 on daily chart, which may remain a cause for comfort. If the price breaks below $44.51 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $49.14 mark may result into a pull-back move towards $50.13 level.

Activision Blizzard, Inc. (ATVI) is projected to climb by 53.04 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $93-month high price target. This represents a whopping 93.15 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $72, which represents a return potential of 49.53 percent when compared to the closing price of the stock of $48.15 on Thursday, December 06. The lowest price target for the stock is $56 — slightly more than 16.3 percent from ATVI’s current share price.

Here’s a rundown of insider trading activity for sense of Activision Blizzard, Inc. (NASDAQ:ATVI). The earliest insider trade took place on 08/20/2018. Zacconi Riccardo parted with a total of 19.76 thousand shares of company at average share price of $68.7. The total for the sales was set at $1.36 million. After this transaction, the CEO, King account balance stood at 14.08 thousand shares. The stock lost -32.29 percent since that insider sale. On 05/17/2018, Zacconi Riccardo, CEO, King, sold 19.76 thousand shares at a price per share of $70.49. This removed 1.39 million shares from the insider’s fortune and the stock saw a -34 percent retreat in value since the news became public. This transaction left 21.12 thousand shares in the CEO, King account. On 03/14/2018, Chief Corporate Officer Durkin Dennis M performed a sale transaction worth $5.41 million. This sale at $75.65 each has eliminated 71.49 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -38.51 percent decrease since the transaction was reported. The insider now is left with 122.6 thousand shares remaining in the account. Wereb Stephen G, who performs the Principal Accounting Officer job, sold 120.52 thousand shares for $8.72 million. The disposal occurred on 03/01/2018 was priced at $72.38 per share. The share price plunged -35.73 percent since the reporting date. Wereb Stephen G now left with a stake of 48.51 thousand ATVI stock worth $2.34 million after the insider selling.

ATVI shares accumulated 1.63 points or 3.5 percent on Thursday to $48.15 with a heavy trade volume of 18.403 million shares. After opening the session at $46.25, the shares went as high as $48.31 and as low as $45.5, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $38.7 billion and now has 804.05 million shares outstanding. Activision Blizzard, Inc. (ATVI) stock has lost -25.16 percent of market value in 21 trading days.

Analysts at JP Morgan upped their rating on shares of Activision Blizzard, Inc. (NASDAQ:ATVI) from Neutral to Overweight in their opinion released on December 06. Analysts at Wedbush are sticking to their Outperform recommendation. However, on November 09, they lifted target price for these shares to $81 from $100. Analysts at Wedbush, made their first call for the stock with a Outperform rating, according to a research note that dated back to November 09.

ATVI stock has a trailing 3-year beta of 1.1, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $1.58 a share in the trailing twelve months. The stock’s value has fallen -23.96 percent year to date (YTD) against a decline of -19.14 percent in 12 month’s time. The company’s shares still trade -43.14 percent away from its 1-year high of $84.68 and 3.91 percent up from 52-week low of $46.34. The average consensus rating on the company is 2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Shares of Activision Blizzard, Inc. (ATVI) are trading at a P/E ratio of 42.91 times earnings reported for the past 12 months. The industry ATVI operates in has an average P/E of 36.8. Its P/E ratio went as low as 10.55X and as high as 32.47 over the 5-year span. Further, it is sporting a 5.41 on the Price-to-Sales ratio. Compare this with the industry average P/S of 8.54. 65.3 percent is the gross profit margin for Activision Blizzard, Inc. and operating margin sits at 20.4 percent. Along with this, the net profit margin is 8.1 percent.

ATVI will be declaring its Q4 financial results on February 07. Analysts are forecasting revenue to climb 15.5 percent to $3.05B in the next fiscal quarter, while earnings are seen soaring by nearly 38.3 percent to $1.3 per share. History has shown that shares in Activision Blizzard, Inc. have gone up on 18 different earnings reaction days and are predicted to add 0.05 percent when the company reports upcoming earnings. In last reported earnings results, it earned $0.52 per share, better than the $0.5, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $1.66B, in line with the $1.66B analysts expected. Earnings are estimated to increase by -7 percent this year, 7.56 percent next year and continue to increase by 11.97 percent annually for the next 5 years.