Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, video game giant Activision Blizzard
With that in mind, let's take a closer look at Activision's business and see what CAPS investors are saying about the stock right now.
Activision facts
| Headquarters (Founded) | Santa Monica, Calif. |
| Market Cap | $13.6 billion |
| Industry | Home entertainment software |
| Trailing-12-Month Revenue | $4.77 billion |
| Management | President/CEO Robert Kotick COO/CFO Thomas Tippl |
| Trailing-12-Month Return on Equity | 6.2% |
| Cash/Debt | $2.94 billion / $0 |
| Dividend Yield | 1.4% |
| Competitors |
Electronic Arts Sony Take-Two Interactive |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 7,006 members who have rated Activision believe the stock will outperform the S&P 500 going forward. These bulls include All-Star Dukenewkirk, who is ranked in the top 10% of our community, and Raylanw.
Just last month, Dukenewkirk tapped Activision as a clear bargain opportunity:
Absolutely, undeniably and several more powerful adjectives apply here when I make the bold assertion that this company is best in breed. ... It is absolutely beyond me the stock still languishes between $11 and $12. Silly, just silly. The cash flow is phenomenal right now.
In fact, Activision boasts a whopping trailing-12-month free cash flow margin of 24%. That's much higher than that of rivals Electronics Arts (7.3%), Sony (4.7%), and Take-Two (5.4%).
CAPS member Raylanw elaborates on the Activision bull case:
With growing revenue, apparent stock buyback and cash stocked up ... this company looks like a great value buy. As a consumer of this company, their upcoming releases and current franchises will keep their position at the top of the gaming industry for at least two years if not more. With Diablo 3 coming up with an auction system, they may be moving toward a groundbreaking concept which may catapult them past ERTS recent social gaming plays. Lastly, their revenue and earnings have been impressive whereas their stock has more or less stayed flat which further leads me to believe this is a great value pick.
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