Goldman Sachs believe in Activision Blizzard and issue a buy recommendation. This relates to yet-to-be-announced titles like a new Diablo or Overwatch 2. Just that drives the stock price of Activision Blizzard up.
One of the top companies on Wall Street has now issued a recommendation for shares of Activision Blizzard. The Goldman Sachs Group has changed its rating from “Neutral” to “Buy”. It is believed that Activision Blizzard will generate higher profits in 2019 and 2020 than expected.
Buy recommendation for Activision Blizzard
In a statement, Goldman Sachs says that the weaknesses in video games recently are due to technical factors such as the tax reform. Fundamentally, however, the business is sound. Nothing has changed in that respect. It is now considered a good time to invest in the video game industry, particularly in Activision Blizzard.
Release of Overwatch 2 expected in 2020 – Diablo 4 in 2019
Goldman Sachs has raised profit expectations for 2019 and 2020 because it anticipates a strong game lineup that is currently not reflected in the valuation. This is especially based on three titles:
- It expects a new Diablo in 2019, which should sell at least 15 million units
- And with Overwatch 2 in 2020, which is expected to sell 20 million units in the first year
- it also believes in a Blizzard mobile game
These assessments are considered “conservative”; thus, it is believed that Activision Blizzard will perform well in 2019 and 2020. To support this, it references comparison values from Overwatch and Diablo 3.
According to Goldman Sachs, the stock price of Activision Blizzard has already risen by 1%.
Assessment aligns with gaming news from recent months
The speculations from Goldman Sachs align with many news reports about secret projects at Blizzard. Recently, some key people have been pulled from ongoing games to work on new projects that have not yet been announced. In addition to such reports, it is mainly job postings from Blizzard that provide hints about future games.
- There have been rumors for months about an action game in the Diablo universe that leans more towards “MMO”.
- A mobile game in the “strategy” category has also come within reach through job postings.
- Only the news regarding Overwatch 2 is being heard for the first time now – but it seems obvious that Blizzard wants to do more with the attractive IP.
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