Interactive entertainment firm Activision Blizzard, Inc. (NASDAQ: ATVI) has planned to delay the launch of a Call of Duty game scheduled for next year, Bloomberg reported citing people familiar with the matter.
It will be the first time since 2005 that the company will not release a new version of the game.
Sources said that the decision has nothing to do with the California-based company’s sale agreement with Microsoft (NASDAQ: MSFT).
Instead, the delay is the result of the failure of last year’s entry, Call of Duty: Vanguard, which has led to the belief that Activision is introducing new versions too soon, the sources added.
A company spokesman said, “We have an exciting slate of premium and free-to-play Call of Duty experiences for this year, next year and beyond.”
Activision Blizzard develops and publishes console, online and mobile games.
Wall Street’s Take
Following the announcement of the delay, Jefferies (NYSE: JEF) analyst Andrew Uerkwitz maintained a Buy rating on the stock with a price target of $95 (17.7% upside potential).
The analyst said, “With production becoming more difficult, shelf life lasting longer, and new business models, it should come as no surprise this day was inevitably on the horizon.”
Overall, the stock has a Moderate Buy consensus rating based on 11 Buys and 12 Holds. The average ATVI price target of $96 implies 19% upside potential. Shares have gained 19.7% year-to-date.
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, offers insight into Activision’s performance.
According to the tool, compared to the previous year, Activision’s website traffic registered a 43.5% decline in global visits year-to-date.
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