Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, online social games operator Zynga
With that in mind, let's take a closer look at Zynga's business and see what CAPS investors are saying about the stock right now.
Zynga facts
| Headquarters (founded) | San Francisco (2007) |
| Market Cap | $7.2 billion |
| Industry | Home entertainment software |
| Trailing-12-Month Revenue | $1.1 billion |
| Management | Founder/Chairman/CEO Mark Pincus CFO David Wehner |
| Trailing-12-Month Return on Equity | (36.2%) |
| Cash/Debt | $1.8 billion / $0 |
| Competitors |
Dena Electronic Arts Gameloft |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 70% of the 429 members who have rated Zynga believe the stock will underperform the S&P 500 going forward.
Earlier this month, one of those Fools, dmiller5350, cautioned Fools about Zynga's faddish qualities:
Looked through all my old apps the other day and deleted a bunch of games exactly like the ones Zynga creates. All these games are addicting but ALWAYS short lived. ... Eventually Zynga titles won't be the next big game, and that's guaranteed. They spent way too much money to purchase OMGPOP for DrawSomething. I played that game for a week and was done, never was I even tempted to pay money. ...
The stock may pop briefly with [Facebook] IPO but it can't keep buying competitor games as the barrier of entry is so cheap there could be hundreds of thousands of competitors in the future. They'll also have a hard time being profitable in other channels. ...
This stock valuation is a joke and a house of cards, eventually it's going to come crashing down.
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Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.
