3 Upcoming Catalysts That Could Lift Zynga's Stock

Mobile game company Zynga Inc ZNGA is well-known for several forever franchises and has been acquiring additional studios. The company has several catalysts coming in November, which could provide some upside for its shares trading near a 52-week low.

Farmville 3: Many have likely heard of or played the hit games “FarmVille” and “FarmVille 2.” The casual games were staples on Facebook, Inc. FB, where they ranked as the top-played games for two years from 2009 to 2011.

Zynga is launching “FarmVille 3” on Nov. 1 and recently announced pre-registration for the game and shared some details of what gamers can expect.

“FarmVille 3” will be launched on the App Store for Android devices from Alphabet Inc GOOGGOOGL and iOS from Apple Inc AAPL. The game will also be available for MacOS.

“Twelve years ago, FarmVille burst onto the gaming scene, creating a loyal following that has drawn over 700 million installs for the FarmVille series worldwide,” Zynga President of Publishing Bernard Kim said.

The game will feature Marie, a fan-favorite character, as the guide for the game. “FarmVille 3” will also feature more than 150 breeds of animals that can be collected and bred. The game says that weather will be an interesting aspect added to the game.

In December 2020, Facebook pulled support for games, which took away a source of customers for Zynga.

The company has released several mobile versions of past FarmVille games, but “FarmVille 3” will mark the franchise’s next chapter for growth. FarmVille once had more than 35 million daily active users. A strong launch of a well-known franchise could help bring more attention to Zynga and its stock.

Related Link: Why Zynga's Earnings Dip Is Potentially A Great Opportunity For Bulls 

Acquisitions: Zynga announced Thursday that its acquisition of StarLark closed. The deal expands the company’s game portfolio and also increases its international presence with a game studio in China.

StarLark’s “Golf Rival” is the second-largest mobile golf game in the world.

In the second quarter, Zynga closed its acquisition of Chartboost, a leading mobile advertising and monetization platform. With a strong presence in the gaming space and increased advertising revenue, the acquisition could continue the momentum for monetization efforts.

“In Q4, we expect to see sequential growth in our topline performance primarily driven by stronger live services, advertising seasonality and our launch of FarmVille 3, as well as a model first full quarter contribution from Chartboost,” the company said in its second-quarter earnings report.

Updated Guidance: Zynga will announce an update to its full-year guidance on Nov. 8 when it reports its third-quarter earnings, the company said Thursday.

The company reported record quarterly advertising revenue and bookings in the second quarter and could report a strong third quarter as well.

The acquisitions and launch of “FarmVille 3” could be providing more upside in fiscal 2021 for the company.

Zynga’s revenue has grown in each of the last five quarters. Reported revenue was $452 million, $503 million, $616 million, $680 million and $720 million, respectively, over the last five quarters.

Zynga could also share an early look at fiscal guidance for the next fiscal year.

ZGNA Price Action: Zynga shares are up 2.74% to $7.49 on Thursday after market close. Shares have traded between $7.14 and $12.32 over the last 52 weeks.

Image: Zygna video