If you have some spare cash sitting around being lazy then you may be inclined to get it working for you. Perhaps you should invest some of that money in a game publisher. No, I don't mean hording rare game cartridges, I mean buying stock. One would-be investor has his or her eye on Electronic Arts and asks the Orlando Sentinel the eternal question: "I'm being told that Electronic Arts Inc. has great prospects, but its stock hasn't been all that great. What do you think?" Well, what do you think, Orlando Sentinel?
The head of Microsoft Corp.'s Xbox division, Peter Moore, was hired to oversee EA's profitable sports-game business. The former president of Activision's publishing division, Kathy Vrabeck, was hired to lead a new casual-games division. Following those moves, the analyst consensus rating of EA stock is "buy," according to Thomson Financial, consisting of eight "strong buys," 11 "buys," and 12 "holds."
EA has 10 new releases planned for the current fiscal year, including some specifically for Nintendo's Wii. The company has been criticized for not having enough Wii game titles. Earnings are expected to increase 45 percent in its fiscal year ending in March 2008 and 71 percent the following fiscal year. Projected five-year annualized growth rate is 20 percent versus 13 percent forecast for the multimedia and graphics-software industry.
A few months ago a co-worker read about the runaway success of the Nintendo Wii and asked me if now was a good time to buy stock in Nintendo. I had to tell him that the best time to buy stock in Nintendo was 2003. Buy low, sell high, and all that (fun fact: most people who buy stock in EA tend to buy more stock the following year and then again the year after that, but the stock doesn't perform quite as well as people remember from the year before). None of my traditional financial investments are in video games, unfortunately. Like most of you out there my gaming investments involve, yes, hording rare game cartridges. Someday when I step forward with the last known original sealed copy of Kwirk, the financial world will bow at my feet.
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