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Activision Blizzard Analyst Sees Its Deal With Microsoft Happening

Benzinga Real-time News ·  Jan 29, 2023 11:06
  • Wedbush analyst Nick McKay assumed coverage on $Activision Blizzard (ATVI.US)$ with an Outperform rating and a price target of $95.

  • The analyst expects $Microsoft (MSFT.US)$ to close its proposed acquisition of Activision Blizzard over the next several months.

  • At a high level, Microsoft must maintain the status quo within the video game industry through legally binding agreements that address game availability, pricing, quality, and release timing.

  • Once the company has entered into such agreements, regulatory concerns around the potential for lessening competition should largely subside, paving the way for the deal's completion in relatively short order.

  • There appears to be less concern from the investors whom the analyst spoke with about the implications of the deal falling apart for Activision Blizzard's share price.

  • The analyst attribute that it has moved past the pandemic-related slowdown to development faster than its primary peers, as reflected in the high quality and intense performances of its FY22 releases and the significant potential of its FY23 releases.

  • The shares remain part of the Wedbush Securities Investment Committee's Best Ideas List.

  • In January, $Alphabet-A (GOOGL.US)$ Google and $NVIDIA (NVDA.US)$ joined $Sony (SONY.US)$ in raising issues with the $69 billion deal, which the FTC opposed in December.

  • The FTC argued that the deal would impede competition in the video game industry and has scheduled an in-house trial for August.

  • Sony, whose PlayStation console competes with Microsoft's Xbox, has previously argued that it sees the Activision deal as anti-competitive.

  • Price Action: ATVI shares traded higher by 0.20% at $76.76 on the last check Friday.

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