Electronic Arts Inc. (NASDAQ: EA) shares fell on Monday Nov 21 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.
Meanwhile, stocks were set to open higher this morning. The Dow Jones Industrial Average futures YMZ6, +0.20% was 10 points, or less than 0.1%, higher at 18,863, while S&P 500 index futures ESZ6, +0.44% rose 3.95 points, or 0.2%, at 2,184.75. Nasdaq-100 NQZ6, +0.74% added 12.25 points, or 0.2%, to 4,820.75.
Analysts at Vetr Inc. downgraded shares of Electronic Arts Inc. (NASDAQ: EA) from Buy to Hold in a research note to investors today. With a rating of Hold on the stock, the company has a 52-week high of $86.07. A number of other analysts have commented on the company recently, and Electronic Arts Inc. has earned a consensus one-year price target of $92.29, above the opening price of $79.07. Downgrades occur when analysts consider that the future prospects for the security have dropped from the original recommendation, often caused by a material and integral digression in the company’s operations, future direction or industry.
Electronic Arts Inc. (NASDAQ: EA) shares last traded at $78.23, a dip of $0.76 per share or -0.96% compared to the previous closing price. Opening at $79.07, they varied from $78.04 and $79.18 throughout the day.
Electronic Arts Inc. (NASDAQ: EA) currently has a market cap of 23.61B.
Electronic Arts Inc. (NASDAQ: EA) Average Daily Trading Volume
The stock’s average daily volume is 3,126,670 shares out of a total float 299,890,000 and some 405,476 shares crossed the trading desk yesterday, lower than the norm. Look for trading volume to pick up in the coming days as momentum traders often use increases in trading volume to identify large volume aggregation or circulation by institutional investors.
As with all possible breakouts, investors watch for volume to be at least 40%-50% above normal on the breakout to indicate that fund managers and other professional investors are jumping in.
Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.
These instituitional investors retain substantial teams of analysts researching thousands of stocks, so it is good validation to see them taking a postion in a stock you’re considering.
Electronic Arts Inc. (NASDAQ: EA) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
Traders are able to make make more effective judgments on trades when they follow the activity of professional investors.
Trades for Electronic Arts Inc. (NASDAQ: EA) have ranged from $53.01 – 86.07, and the stock now has a 50-day MA of $81.61 and 200-day MA of $78.36. Today’s last price is 9.11%% below the 52 week high of $86.07.
Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors watch for companies that have raised their earnings at least 25% or more for a 3 year period.
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