At Zynga Inc. (NASDAQ:ZNGA), Share Price Got a Bit Ahead of the Fundamentals

Zynga Inc. (NASDAQ:ZNGA) shares fell to a low of $8.085 before closing at $8.23. Intraday shares traded counted 4.31 million, which was 79.34% higher than its 30-day average trading volume of 20.86M. ZNGA’s previous close was $8.14 while the outstanding shares total 952.50M. The firm has a beta of 0.27, a 12-month trailing P/E ratio of 127.11, and a growth ratio of 9.93. The stock’s Relative Strength Index (RSI) is 66.68, with weekly volatility at 3.15% and ATR at 0.29. The ZNGA stock’s 52-week price range has touched low of $5.51 and a $8.36 high. The stock traded higher over the last trading session, gaining 1.23% on 05/21/20.

Investors have identified the Electronic Gaming & Multimedia company Zynga Inc. as an interesting stock but before investments are made there, an in-depth look at its trading activities will have to be conducted. The share is trading with a market value of around $7.63 billion, the company now has both obstacles and catalysts that affect them and they came from their mode of operations. With the company affected by events currently, it is a perfect time to analyze the numbers behind the firm in order to come up with a rather realistic picture of what this stock is.

Zynga Inc. (ZNGA) Fundamentals that are to be considered.

When analyzing a stock, the first fundamental thing to take into account is the balance sheet. How healthy the balance sheet of a company is will determine if the company will be able to carry out all its financial and non-financial obligations and also keep the faith of its investors. For ZNGA, the company has in raw cash 582.43 million on their books with 16.04 million currently as liabilities. How the trend is over time is what investors should be concerned about. The company has a healthy balance sheet as their debt profile has been on an incline. In terms of their assets, the company currently has 1504146000 million total, with 797838000 million as their total liabilities.

ZNGA were able to record -43.73 million as free cash flow during the third quarter of the year, this saw their quarterly net cash flow reduce by 129.1 million. In cash movements, the company had a total of -35.19 million as operating cash flow.

Potential earnings growth for Zynga Inc. (ZNGA)

In order to determine the future investment potential for this stock, we will have to analyze key trends that affect it. During the third quarter of the year, Zynga Inc. recorded a total of 403.77 million in revenue. This figure implies that they witnessed a quarterly year/year change in their earnings with 34.27% coming in sequential stages and their sales for the third quarter reducing by -0.17%.

What matters though is how it ends. When the core data for the company is broken down, then the stock sounds interesting. The company spent 146.2 million trying to sell their products during the last quarter, with the result yielding a gross income of 257.56 million. This allows shareholders to hold on to 952.50M with the revenue now reading -0.11 cents per share. This is a figure that is close to analyst’s prediction for their fourth quarter (0.02 cents a share).

Having a look at the company’s valuation, the company is expected to record -0.06 total earnings per share during the next fiscal year. It is very important though to remember that the importance of trend far outweighs that of outlook. This analysis has been great and getting further updates on ZNGA sounds very interesting.

Is the stock of ZNGA attractive?

In related news, Chief Operating Officer, Bromberg Matthew S sold 12,000 shares of the company’s stock in a transaction that recorded on May 19. The sale was performed at an average price of 8.09, for a total value of 97,080. As the sale deal closes, the Chief Accounting Officer, Buckley Jeffrey now sold 4,727 shares of the company’s stock, valued at 37,580. Also, Director, Siminoff Ellen F sold 5,000 shares of the company’s stock in a deal that was recorded on May 15. The shares were price at an average price of 7.90 per share, with a total market value of 39,500. Following this completion of acquisition, the Chief Operating Officer, Bromberg Matthew S now holds 12,000 shares of the company’s stock, valued at 90,360. In the last 6 months, insiders have changed their ownership in shares of company stock by 4.30%.

15 out of 21 analysts covering the stock have rated it a Buy, while 3 have maintained a Hold recommendation on Zynga Inc.. 1 analysts has assigned a Sell rating on the ZNGA stock. The 12-month mean consensus price target for the company’s shares has been set at $7.96.