King Digital Entertainment Stock Soars After Q4, But Not All Are Bullish
TipRanks | Feb 15, 2015 08:16AM ET
Shares of mobile game maker King Digital Entertainment PLC (NYSE:KING) jumped about 21% in trading on Thursday, February 12th after the company exceeded fourth quarter earnings expectations. Most notably, the company revealed a stronger-than-expected launch of the sequel to its popular “Candy Crush” game.
Highlights from King Digital’s Q4 report include adjusted earnings of $0.57 per share, beating analysts’ estimates by $0.10, but also marking an 11% decrease from the same quarter a year prior. The company posted adjusted revenue of $559.2 million, down from $601.4 million year-over year, but coming ahead of analysts’ consensus estimate of $519.93 million.
The company also announced a special dividend of $300 million, or $0.94 per share, to be paid to shareholders on March 24, marking the third straight quarter the company has returned cash to shareholders.
King Digital Entertainment believes the rapid download rate of the sequel to its mega hit Candy Crush Saga was able to reverse the decline in income from the original game. In addition, the company has said the success of the second Candy Crush game proves its ability to create popular games and extend the lifespan of its brands.
Chief Executive Riccardo Zacconi said of the company’s results, “The success of ‘Candy Crush Soda Saga’ outperformed our expectations, not only proving that we have a strong brand (in ‘Candy Crush’) but also proving the strength of our franchise model strategy.”
RBC Capital analyst
Overall, Michael Pachter has a 43% success rate recommending stocks and a +0.3% average return per recommendation.
On average, the top analyst consensus for King Digital Entertainment on TipRanks is Hold.
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