Electronic Arts recently announced "Star Wars Zero Company," a new game developed in collaboration with Bit Reactor, Respawn Entertainment, and Lucasfilm Games, reflecting its commitment to expanding the Star Wars franchise. The company’s stock price saw a rise of around 3% over the last quarter. This movement might have been influenced by several factors, including EA's strategic initiatives such as the release of "Split Fiction" and the completion of a significant share buyback. These activities likely added weight to the broader market's upward trend, which saw a 1% decline over the same period.

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The recent announcement of "Star Wars Zero Company" is expected to further strengthen Electronic Arts' (EA) position in the gaming industry, aligning with its commitment to expanding the Star Wars franchise. Such initiatives could positively impact EA's revenue and earnings forecasts by attracting more players, increasing engagement, and solidifying its market presence. EA's focus on collaborations, such as with Bit Reactor and Lucasfilm Games, may also enhance its portfolio diversity and potentially contribute to long-term revenue growth, as outlined in analysts' assumptions. The 3% rise in EA’s stock over the last quarter suggests that investors have some confidence in these developments, though the current share price of US$142.97 is close to the consensus price target of US$146.22, indicating the market may already be factoring in these future growth prospects.

Over the past five years, EA achieved a total return of 28.33%, which demonstrates sustained investor confidence over the longer term. Compared to the broader market's 5.9% return in the past year, EA outperformed peers within the US market, despite underperforming the US Entertainment industry, which saw a 36.7% return. This longer-term outperformance could be attributed to EA's past strategic initiatives, though recent earnings growth has been challenging, with a 2.8% decline over the past year. The company's earnings moving forward are forecast to grow 12.7% annually, slower than the market but potentially boosted by new game releases and operational efficiencies.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NasdaqGS:EA.

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