Posted on January 20, 2012, Phil Hornshaw Analyst Says Star Wars: The Old Republic Undersold Expectations, EA Stock Drops
For some reason, it seems Electronic Arts investors are a fickle bunch (who may not really understand what they’re investing in). Analysts keep up their doomsaying over Star Wars: The Old Republic despite quite a reception and a lot of people playing it, and when those analysts say spooky things, investors sell their shares.
That’s what happened on Jan. 19, as CVG reports, when EA shares dropped 3.8 percent after Brean Murray Curret & Co. analyst Todd Mitchell speculated that SWTOR sales would come in “below expectations.” Mitchell cut his price on EA stock from $28 to $22, saying, “Specifically, initial sales appear to be below expectations, and casual observation of early play is causing us to rethink our churn assumptions.”
Another analyst, on the other hand, calls the outcries over SWTOR’s sales figures “overdone.” As Gamasutra reports, Macquarie Securities’ Ben Schachter says that it’s outside speculation that’s knocking down EA’s stock price, which has dropped 30 percent since Nov. 4 last year, and while he acknowledges that sales for SWTOR might have been under expectations, EA still maintains that it’s among the fastest-growing MMOs ever in its first month.
Earlier this week, another analyst speculated that EA invested some $500 million to make SWTOR (a number that seems…inflated), but EA has said it only needs about 500,000 subscribers for the game to turn a profit.
Sounds like a lot of negative attention for SWTOR when the game is barely a month old and still seems to be performing admirably. Guess we’ll see next month after the first month’s subscription numbers are in.