Yahoo Finance If You Invested $1000 in Electronic Arts a Decade Ago, This is How Much It'd Be Worth Now
For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Electronic Arts (EA) ten years ago? It may not have been easy to hold on to EA for all that time, but if you did, how much would your investment be worth today?
Electronic Arts' Business In-Depth
With that in mind, let's take a look at Electronic Arts' main business drivers.
Headquartered in Redwood City, CA, Electronic Arts is a leading developer, marketer, publisher and distributor of interactive games (video game software and content).
Electronic Arts, popularly known as EA, distributes its gaming content and services through multiple distribution channels as well as directly to consumers (online and wirelessly) through its online portals — Origin and Play4Free.
EA games can be played on video consoles, personal computers, mobile devices, tablets and electronic readers. The company generates revenues from the sale of disk-based video game products (known as packaged goods), downloadable contents (DLCs), subscription, micro-transactions and advertising.
EA generated revenues of $6.99 billion in fiscal 2022, of which live services and other revenues contributed 71.4% and the remaining were generated from packaged goods and full game downloads.
Net bookings for fiscal 2022 were $7.51 billion, up 21% year over year.
The EA player network grew 16% in fiscal 2022 to more than 580 million unique active accounts.
The company operates in three divisions — EA Studios, Maxis and EA Mobile. EA Studios includes DICE (Sweden), EA Canada (Canada), Tiburon (the United States), BioWare (Canada and the United States) and Visceral (the United States).
EA faces substantial competition from console and personal computer game publishers and diversified media companies that include Sony, Microsoft, Nintendo, Activision Blizzard, Take-Two Interactive and Ubisoft. In the mobile and social gaming market, the company competes with Zynga.
Bottom Line
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Electronic Arts a decade ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in April 2013 would be worth $7,075.50, or a gain of 607.55%, as of April 28, 2023, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 161.36% and the price of gold went up 31.11% over the same time frame.
Analysts are forecasting more upside for EA too.
Electronic Arts’ digital and live services are expected to gain from portfolio strength on the back of the franchises including Apex Legends, FIFA, Madden NFL and Star Wars. EA has been witnessing a rise in usage and engagement levels for games under FIFA franchise especially FIFA Online 4 and FIFA Mobile. EA also rolled out two AAA titles, NHL 23 and Need for Speed Unbound and provided 128 content updates across 36 titles in the last reported quarter. Considering the abovementioned factors, we expect fiscal 2023 net sales to grow 4.4% year-over-year. However, Electronic Arts revised net bookings guidance for the full-year fiscal year 2023 to be between $7.07 billion and $7.17 billion, which reflects the shift of Star Wars Jedi: Survivor to first-quarter fiscal 2024.
The stock has jumped 6.22% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 3 higher, for fiscal 2023; the consensus estimate has moved up as well.
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Electronic Arts Inc. (EA) : Free Stock Analysis Report
