Will Electronic Arts Continue This Run?

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With shares of Electronic Arts (NYSE:EA) trading around $35, is EA an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Electronic Arts develops, markets, publishes, and distributes game software content and services that can be played by consumers on a variety of video game machines and electronic devices. Its offers video game products through gaming consoles such as the Sony Playstation 3, Microsoft Xbox 360, and Nintendo Wii. Electronic Arts’s products can also be used on personal computers, mobile devices, tablets, electronic readers, and social networking sites that include popular platforms like PCs, Apple Mac, Apple iPhone, Google Android, Apple iPad, Amazon Kindle, and Facebook.

Electronic Arts’ Online Services Updates page has added a long list of games that will lose online functionality come June 30. Some of the notable games on the list include Battlefield 2 (PC), Battlefield 1942 (PC, Mac), Battlefield 2142 (PC, Mac), Command & Conquer: Red Alert 3 (PC, Mac), Crysis 2 (PC), Need for Speed: Hot Pursuit 2 (PC), Neverwinter Nights 2 (PC, Mac), and Star Wars: Battlefront II (PC and PlayStation 2.) According to EA, the games are losing online functionality on June 30, a full month after the GameSpy shutdown. Crytek, for example, already confirmed that both Crysis and Crysis 2 will go offline May 31. “Since GameSpy’s announcement, our teams have been working to evaluate options to keep services up and running,” EA said on its website. “Unfortunately, due to technical challenges and concerns about the player experience, we do not have a solution at this time. Online services for EA games on the GameSpy platform will be closed down at the end of June. We know some of these games are still fan favorites, including Battlefield 2, Battlefield 1942, Medal of Honor: Allied Assault, and Command & Conquer games. We are still investigating community-supported options to preserve online functionality for these titles, such as multiplayer. Significant technical hurdles remain, and at this time we don’t have anything to announce.”

EA’s official Twitter (NYSE:TWTR) account also previously said that it was working on transitioning Battlefield 2, Battlefield 2142, and Battlefield Bad Company 2 to a different solution, but that there were still hurdles ahead. Bad Company 2 is not on the list of games losing online services. Other companies affected by the May 31 GameSpy shutdown, like 2K and Rockstar, have said which games they’re transitioning to a different solution and which will go offline. Some games, like Halo: Combat Evolved for the PC, Star Wars: Battlefront II, and Battlefield 1942 will live on thanks to GameRanger, which allows gamers to host their own servers for a wide range of computer games, including some being affected by the GameSpy shutdown.

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