Electronic Arts (EA) is set to report Q2 results after the bell (released results last quarter at 4:00pm ET). The co has a conference call scheduled to follow at 5:00pm ET. Cap IQ Consensus estimates Q2 EPS of $0.43 (vs. $0.65 in 2Q15) w/revs of $1.09 bln (-4.8% y/y).
- GAAP net revenue is expected to be approximately $915 million.
- GAAP net loss is expected to be approximately ($51) million.
- GAAP loss per share is expected to be approximately ($0.17).
- Ending March 31, 2017 GAAP net revenue is expected to be approximately $4.750 billion (Reaffirm).
- GAAP net income is expected to be approximately $809 million.
- GAAP diluted earnings per share is expected to be approximately $2.56 (Prior guidance was $2.53)
- Based on EA options, the current implied volatility stands at ~ 39%, which is 95% higher than historical volatility (over the past 30 days). Based on the EA Weekly Nov04 $77 straddle, the options market is currently pricing in a move of ~7% in either direction by weekly expiration (Friday).
Last week's downgrade took the wind out of the stock. Sellers responded with an aggressive drop below its rising 50-day moving average which has price in "no-man's land" ahead of earnings. Next key support is the 200-day simple ma near 73.