Activision shares off on downgrade
Analyst sees slow to no growth in '07; Wall Street reacts by bidding down publisher's shares.
Activision shares were trading down almost 7 percent today after Banc of America Securities analyst Gary Cooper downgraded the stock from a Buy to a Neutral.
"We believe most, if not all, of the potential positive news regarding Activision's holiday quarter is priced into the stock," Cooper wrote in a research note. In essence, to invest in the company for short-term gain would be ill-advised.
But Cooper sees little long-term potential, either. Stating that the company "is unlikely to grow its earnings in fiscal year 2007," the analyst said that "given the subdued retail traffic ahead of the Xbox 360 launch, the average performance of Gun, and the low ratings of True Crime: New York City, we do not expect Activision to substantially beat its third-quarter-2006 guidance."
At press time, shares in Activision were trading at $15.18, down more than a dollar from the opening bell.
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