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ACTIVISION BLIZZARD INC (ATVI) Stock Fundamental Analysis

NASDAQ:ATVI - Nasdaq - US00507V1098 - Common Stock - Currency: USD

94.42  -0.05 (-0.05%)

After market: 94.54 +0.12 (+0.13%)

Fundamental Rating

7

Overall ATVI gets a fundamental rating of 7 out of 10. We evaluated ATVI against 72 industry peers in the Entertainment industry. ATVI scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ATVI has a correct valuation and a medium growth rate. This makes ATVI very considerable for quality investing!


Dividend Valuation Growth Profitability Health

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8

1. Profitability

1.1 Basic Checks

In the past year ATVI was profitable.
In the past year ATVI had a positive cash flow from operations.
Each year in the past 5 years ATVI has been profitable.
Each year in the past 5 years ATVI had a positive operating cash flow.
ATVI Yearly Net Income VS EBIT VS OCF VS FCFATVI Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 1B 2B 3B

1.2 Ratios

With an excellent Return On Assets value of 7.59%, ATVI belongs to the best of the industry, outperforming 88.31% of the companies in the same industry.
Looking at the Return On Equity, with a value of 10.41%, ATVI belongs to the top of the industry, outperforming 87.01% of the companies in the same industry.
ATVI's Return On Invested Capital of 7.64% is amongst the best of the industry. ATVI outperforms 84.42% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ATVI is significantly below the industry average of 22.90%.
Industry RankSector Rank
ROA 7.59%
ROE 10.41%
ROIC 7.64%
ROA(3y)8.6%
ROA(5y)8.74%
ROE(3y)12.6%
ROE(5y)13.15%
ROIC(3y)10.28%
ROIC(5y)10.19%
ATVI Yearly ROA, ROE, ROICATVI Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 5 10 15

1.3 Margins

ATVI has a better Profit Margin (24.87%) than 98.70% of its industry peers.
ATVI's Profit Margin has improved in the last couple of years.
The Operating Margin of ATVI (25.71%) is better than 98.70% of its industry peers.
In the last couple of years the Operating Margin of ATVI has grown nicely.
ATVI's Gross Margin of 70.38% is amongst the best of the industry. ATVI outperforms 87.01% of its industry peers.
ATVI's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 25.71%
PM (TTM) 24.87%
GM 70.38%
OM growth 3Y-6.16%
OM growth 5Y3.49%
PM growth 3Y-4.62%
PM growth 5Y38.88%
GM growth 3Y1.34%
GM growth 5Y1.83%
ATVI Yearly Profit, Operating, Gross MarginsATVI Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 20 40 60

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8

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ATVI is still creating some value.
ATVI has more shares outstanding than it did 1 year ago.
The debt/assets ratio for ATVI has been reduced compared to a year ago.
ATVI Yearly Shares OutstandingATVI Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 200M 400M 600M
ATVI Yearly Total Debt VS Total AssetsATVI Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B 15B 20B 25B

2.2 Solvency

ATVI has an Altman-Z score of 7.56. This indicates that ATVI is financially healthy and has little risk of bankruptcy at the moment.
ATVI's Altman-Z score of 7.56 is amongst the best of the industry. ATVI outperforms 93.51% of its industry peers.
ATVI has a debt to FCF ratio of 1.48. This is a very positive value and a sign of high solvency as it would only need 1.48 years to pay back of all of its debts.
ATVI has a Debt to FCF ratio of 1.48. This is amongst the best in the industry. ATVI outperforms 90.91% of its industry peers.
ATVI has a Debt/Equity ratio of 0.17. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.17, ATVI is doing good in the industry, outperforming 64.94% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.17
Debt/FCF 1.48
Altman-Z 7.56
ROIC/WACC0.81
WACC9.47%
ATVI Yearly LT Debt VS Equity VS FCFATVI Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B 15B

2.3 Liquidity

ATVI has a Current Ratio of 4.66. This indicates that ATVI is financially healthy and has no problem in meeting its short term obligations.
ATVI has a better Current ratio (4.66) than 88.31% of its industry peers.
A Quick Ratio of 4.66 indicates that ATVI has no problem at all paying its short term obligations.
ATVI's Quick ratio of 4.66 is amongst the best of the industry. ATVI outperforms 88.31% of its industry peers.
Industry RankSector Rank
Current Ratio 4.66
Quick Ratio 4.66
ATVI Yearly Current Assets VS Current LiabilitesATVI Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 5B 10B

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6

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 50.00% over the past year.
Measured over the past years, ATVI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.32% on average per year.
The Revenue has grown by 13.88% in the past year. This is quite good.
ATVI shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.42% yearly.
EPS 1Y (TTM)50%
EPS 3Y14.92%
EPS 5Y8.32%
EPS Q2Q%129.79%
Revenue 1Y (TTM)13.88%
Revenue growth 3Y5.08%
Revenue growth 5Y1.42%
Sales Q2Q%34.25%

3.2 Future

The Earnings Per Share is expected to grow by 8.90% on average over the next years. This is quite good.
ATVI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.11% yearly.
EPS Next Y26.69%
EPS Next 2Y15.13%
EPS Next 3Y12.41%
EPS Next 5Y8.9%
Revenue Next Year19.41%
Revenue Next 2Y10.08%
Revenue Next 3Y7.86%
Revenue Next 5Y7.11%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
ATVI Yearly Revenue VS EstimatesATVI Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 5B 10B
ATVI Yearly EPS VS EstimatesATVI Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2 4 6

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6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 22.32, ATVI is valued on the expensive side.
Based on the Price/Earnings ratio, ATVI is valued cheaper than 84.42% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, ATVI is valued at the same level.
A Price/Forward Earnings ratio of 20.95 indicates a rather expensive valuation of ATVI.
ATVI's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ATVI is cheaper than 75.32% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, ATVI is valued at the same level.
Industry RankSector Rank
PE 22.32
Fwd PE 20.95
ATVI Price Earnings VS Forward Price EarningsATVI Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

ATVI's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, ATVI is valued cheaply inside the industry as 80.52% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 30.35
EV/EBITDA 23.76
ATVI Per share dataATVI EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15 20 25

4.3 Compensation for Growth

ATVI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of ATVI may justify a higher PE ratio.
ATVI's earnings are expected to grow with 12.41% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.84
PEG (5Y)2.68
EPS Next 2Y15.13%
EPS Next 3Y12.41%

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5

5. Dividend

5.1 Amount

ATVI has a Yearly Dividend Yield of 1.05%.
Compared to an average industry Dividend Yield of 6.55, ATVI pays a better dividend. On top of this ATVI pays more dividend than 93.51% of the companies listed in the same industry.
With a Dividend Yield of 1.05, ATVI pays less dividend than the S&P500 average, which is at 2.37.
Industry RankSector Rank
Dividend Yield 1.05%

5.2 History

On average, the dividend of ATVI grows each year by 9.32%, which is quite nice.
ATVI has been paying a dividend for at least 10 years, so it has a reliable track record.
ATVI has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.32%
Div Incr Years1
Div Non Decr Years13
ATVI Yearly Dividends per shareATVI Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2019 2020 2021 2022 2023 0.2 0.4 0.6 0.8

5.3 Sustainability

The dividend of ATVI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP0%
EPS Next 2Y15.13%
EPS Next 3Y12.41%
ATVI Yearly Income VS Free CF VS DividendATVI Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 500M 1B 1.5B 2B 2.5B

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ACTIVISION BLIZZARD INC

NASDAQ:ATVI (10/12/2023, 8:26:42 PM)

After market: 94.54 +0.12 (+0.13%)

94.42

-0.05 (-0.05%)

Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)07-19 2023-07-19/bmo
Earnings (Next)11-06 2023-11-06/amc
Inst Owners0%
Inst Owner Change0%
Ins Owners20.1%
Ins Owner Change0%
Market Cap74.29B
Analysts68.46
Price Target96.68 (2.39%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.05%
Yearly Dividend0.47
Dividend Growth(5Y)9.32%
DP0%
Div Incr Years1
Div Non Decr Years13
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)16.86%
Min EPS beat(2)14.06%
Max EPS beat(2)19.67%
EPS beat(4)4
Avg EPS beat(4)22.22%
Min EPS beat(4)14.06%
Max EPS beat(4)33.83%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)11.02%
Min Revenue beat(2)-8.61%
Max Revenue beat(2)30.65%
Revenue beat(4)2
Avg Revenue beat(4)-0.61%
Min Revenue beat(4)-27.58%
Max Revenue beat(4)30.65%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-0.03%
PT rev (3m)4.22%
EPS NQ rev (1m)2.28%
EPS NQ rev (3m)-0.37%
EPS NY rev (1m)0%
EPS NY rev (3m)10.04%
Revenue NQ rev (1m)99900%
Revenue NQ rev (3m)-2.26%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.91%
Valuation
Industry RankSector Rank
PE 22.32
Fwd PE 20.95
P/S 8.53
P/FCF 30.35
P/OCF 29.17
P/B 3.57
P/tB 7.62
EV/EBITDA 23.76
EPS(TTM)4.23
EY4.48%
EPS(NY)4.51
Fwd EY4.77%
FCF(TTM)3.11
FCFY3.3%
OCF(TTM)3.24
OCFY3.43%
SpS11.07
BVpS26.43
TBVpS12.38
PEG (NY)0.84
PEG (5Y)2.68
Profitability
Industry RankSector Rank
ROA 7.59%
ROE 10.41%
ROCE 8.88%
ROIC 7.64%
ROICexc 15.98%
ROICexgc 192.53%
OM 25.71%
PM (TTM) 24.87%
GM 70.38%
FCFM 28.12%
ROA(3y)8.6%
ROA(5y)8.74%
ROE(3y)12.6%
ROE(5y)13.15%
ROIC(3y)10.28%
ROIC(5y)10.19%
ROICexc(3y)19.25%
ROICexc(5y)17.42%
ROICexgc(3y)231.4%
ROICexgc(5y)290.82%
ROCE(3y)11.95%
ROCE(5y)11.85%
ROICexcg growth 3Y2.43%
ROICexcg growth 5YN/A
ROICexc growth 3Y-3.08%
ROICexc growth 5Y2.37%
OM growth 3Y-6.16%
OM growth 5Y3.49%
PM growth 3Y-4.62%
PM growth 5Y38.88%
GM growth 3Y1.34%
GM growth 5Y1.83%
F-Score5
Asset Turnover0.31
Health
Industry RankSector Rank
Debt/Equity 0.17
Debt/FCF 1.48
Debt/EBITDA 1.38
Cap/Depr 25.58%
Cap/Sales 1.14%
Interest Coverage 250
Cash Conversion 97.03%
Profit Quality 113.07%
Current Ratio 4.66
Quick Ratio 4.66
Altman-Z 7.56
F-Score5
WACC9.47%
ROIC/WACC0.81
Cap/Depr(3y)21.4%
Cap/Depr(5y)19.66%
Cap/Sales(3y)1.03%
Cap/Sales(5y)1.32%
Profit Quality(3y)108.71%
Profit Quality(5y)106%
High Growth Momentum
Growth
EPS 1Y (TTM)50%
EPS 3Y14.92%
EPS 5Y8.32%
EPS Q2Q%129.79%
EPS Next Y26.69%
EPS Next 2Y15.13%
EPS Next 3Y12.41%
EPS Next 5Y8.9%
Revenue 1Y (TTM)13.88%
Revenue growth 3Y5.08%
Revenue growth 5Y1.42%
Sales Q2Q%34.25%
Revenue Next Year19.41%
Revenue Next 2Y10.08%
Revenue Next 3Y7.86%
Revenue Next 5Y7.11%
EBIT growth 1Y-4.81%
EBIT growth 3Y-1.4%
EBIT growth 5Y4.95%
EBIT Next Year27.57%
EBIT Next 3Y13.63%
EBIT Next 5Y12.47%
FCF growth 1Y-1.53%
FCF growth 3Y7.47%
FCF growth 5Y0.68%
OCF growth 1Y-0.82%
OCF growth 3Y6.63%
OCF growth 5Y0.06%