Activision Blizzard (ATVI) — This interactive game and software developer was formed via the 2008 merger of Activision and Vivendi Games. On Friday, Vivendi sold 41.5 million shares of ATVI at $20.70. S&P believes Vivendi will be restricted from selling additional shares until 2016.
S&P rates ATVI a “four-star strong buy” due to the launch of the next generation of video game consoles by major manufacturers. It estimates operating earnings per share (EPS) will increase from $0.95 in 2013 to $1.30 this year and $1.40 in 2015.
Technically, ATVI is in a powerful bull channel that began in January 2013. The channel is supported by its 200-day moving average, and the price fluctuates above and below its 50-day moving average.
Accumulation is high, but the recent stock offering may provide an opportunity to buy shares under $20. A stop-loss should be entered at $17.75. The trading target is $26.