Electronic Arts Surpasses Analyst Target: What Investors Should Know

In recent trading, shares of Electronic Arts, Inc. (Symbol: EA) have crossed above the average analyst 12-month target price of $163.50, changing hands for $164.12/share. When a stock reaches the target set by analysts, they typically face two choices: either downgrade the valuation or increase their target price. The decision may also depend on recent developments within the company — if Electronic Arts is performing well, an upward adjustment may be warranted.

Within the Zacks coverage universe, 24 different analyst targets contribute to the average for Electronic Arts, Inc. This average is simply a mathematical calculation. Some analysts have lower targets—one, for instance, anticipates a price of $139.00. In contrast, another analyst has set a target as high as $183.00. The standard deviation of the targets is $11.151.

The reason for examining the average EA price target is to leverage the “wisdom of crowds” concept, which combines the insights of numerous analysts rather than relying on a single expert opinion. Now that EA’s stock price has surpassed the average target of $163.50/share, investors are encouraged to evaluate the company’s fundamentals. Is $163.50 just a stepping stone toward a higher target, or does the valuation seem excessive, indicating it’s time to consider selling some shares? Below is a summary of the current analyst ratings for Electronic Arts, Inc.

The average rating above ranges from 1 to 5, where 1 means Strong Buy and 5 stands for Strong Sell. This article utilized data provided by Zacks Investment Research through Quandl.com. For the latest Zacks research report on EA, visit their site.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.