If You Invested $1,000 In Zynga Stock One Year Ago, Here's How Much You'd Have Now

Investors who have owned stocks in the last year have generally experienced some big gains. In fact, the SPDR S&P 500 SPY total return over the last 12 months is 43.8%. But there is no question some big-name stocks performed better than others along the way.

Zynga’s Run: One company that has been a lackluster investment in the last year has been mobile and social media gaming company Zynga Inc ZNGA.

The COVID-19 pandemic in 2020 was actually very good for Zynga’s business. While other companies were dealing with economic shutdowns, people around the world who were sheltering in place had little to do for entertainment and social interactions other than mobile and social media gaming.

In 2020, Zynga’s revenue jumped 49.4% to $1.97 billion. Unfortunately, Zynga also swung from a $41.9 million net profit in 2019 to a $429.4 million net loss in 2020.

See also: How to Buy Zynga Stock (ZNGA)

Despite the pandemic, Zynga has continued its strategy of driving growth via acquisitions. The company’s latest deals include a $1.8 billion buyout of Peak in June 2020, a $180 million buyout of Rollic in October 2020, Echtra Games in March 2021 and a $250 million buyout of Chartboost earlier this month.

At the beginning of 2020, Zynga shares were trading at $6.10. By the beginning of March, the stock was up to $6.84 despite news of the coronavirus spreading in China prompting concerns about a U.S. pandemic.

Zynga bottomed at $5.65 during the pandemic-driven March sell-off. Fortunately for Zynga investors, the dip did not last long.

By the end of April, Zynga shares were back at new 52-week highs above $7, and the stock got as high as $10.69 in August prior to an extended consolidation period.

Related Link: If You Invested $1,000 In Coca-Cola Stock One Year Ago, Here's How Much You'd Have Now

Zynga In 2021, Beyond: In February, Zynga reported record fourth-quarter and full-year revenue and guided for another 31% revenue growth in 2021. Zynga ultimately made it to a new all-time high of $12.32 in February 2021, but the stock has since pulled back to $10.65.

Looking ahead into the next several quarters, Zynga is facing several potential headwinds.

Traders may continue taking profits in the stock after a big run since the start of 2020. Zynga is also struggling with profitability, reporting net losses in each of the past five quarters.

In addition, some sellers may simply see 2020 pandemic comps setting Zynga up for some lackluster growth numbers in coming quarters.

Still, Zynga investors who bought one year ago and held on have generated a decent return on their investment. In fact, $1,270 in Zynga stock bought on May 26, 2020, would be worth about $1,908 today.

Looking ahead, analysts are expecting more upside for Zynga in the next 12 months. The average price target among the 20 analysts covering the stock is $13.50, suggesting 26.5% upside from current levels.

(Photo: Zynga artist, photo by Peter Tracy, courtesy of Zynga)