Zynga Inc (NASDAQ:ZNGA) witnessed a significant decline in short interest for November. Short interest totaled about 63.4 million shares as of Nov. 14, which is a decline of 3.3% from the Oct. 31 total of 65.6 million shares. Presently 8.6% of the company’s shares are sold short.
Will Zynga make a comeback?
Since the IPO, Zynga shares have been underperforming. The game maker is struggling to earn a profit despite reporting over $170 million in revenue. The company did launch new titles in the year so far, such as Zynga Poker and Words with Friends, but has been unable to capture the desired number of players.
However, it is largely believed the stock and the company need one big hit title to regain momentum. This could come soon, as the company has a busy product pipeline. Overall, the gaming market is witnessing an impressive growth due to the shift toward smartphones and tablets. In contrast, Zynga shares are way below their all-time high of $14 and 52-week high of $5.90. However, some hope can be seen, as the company during its last earnings call noted that mobile constituted 55% of total revenue compared to 50% in the second-quarter.
What analysts feel
Many analysts have issued their verdicts on the game maker in recent weeks. In a research note on Nov. 11, analysts at Jefferies Group raised their rating on the stock from Hold to Buy. They also increased their price target from $2.48 earlier to $4.50 now. Benchmark Co. analysts, in a research note on Nov. 10, lowered their price target on Zynga to $2.45. Analysts at Credit Suisse maintained their Underperform rating on the game maker but raised their price target from $3.42 to $3.44. Overall, two analysts have assigned a Sell rating to the stock, six have rated it as a Hold, and two have assigned it a Buy rating. Presently, Zynga has an average rating of Hold and a consensus price target of $3.75.
For the last reported quarter, Zynga posted losses per share of 1 cent, which was in line with the consensus estimates. Revenue for the quarter came in at $176.60 million, compared to the consensus estimate of $171.70 million. The company posted losses per share of 2 cents in the same quarter last year, while revenue was up 12.8% for the same period. For the year, analysts expect Zynga to post losses per share of 1 cent.