Israel-based Playtika (NASDAQ:PLTK) closed higher on Monday, April 10, after Bloomberg reported that the company had attracted interest from private equity buyers. Shares of this mobile gaming company and monetization platform have outperformed the S&P 500 Index (SPX) and gained about 40% year-to-date.
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The uptrend in PLTK stock reflects the company’s efforts to reduce costs and drive profitability. Playtika is conducting a strategic review that includes a possible sale of the business or a new acquisition. Furthermore, the company is streamlining its operations and realigning its costs with a growth outlook, which will drive its future earnings growth.
In addition, the company is prioritizing its investments in projects with a higher ROI (Return on Investment), which is a positive move in a challenging operating environment.
Wedbush analyst Michael Pachter endorses PLTK’s strategy to prioritize investments in high-ROI projects. Pachter added, “Given the company’s planned retrenchment and elimination of new games, we think that flattish growth in 2023 is an impressive feat.”
The analyst believes that the recovery in revenues could give a significant lift to Playtika’s stock. He maintains a Buy recommendation on PLTK stock, while his price target of $14.25 implies 19.65% upside potential.
Is Playtika Stock a Good Buy?
Playtika stock has a Moderate Buy consensus rating on TipRanks based on three Buy and five Hold recommendations. Further, analysts’ average price target of $12.89 implies 8.23% upside potential.
