Online game maker Zynga prices IPO at $10 a share

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“The same forces that affected the entertainment business are affecting the video game business,” Mahoney said.

Not everyone is big on Zynga, though. “FarmVille” and its ilk annoy some Facebook users who get tired of their crop-harvesting friends asking for help with their virtual farms.

There are naysayers on Wall Street too. Sterne Agee analyst Arvind Bhatia took the unusual step of putting an “Underperform” rating on Zynga this week, days before the company was scheduled to go public. The analyst set a price target of $7 for Zynga’s yet-to-be traded stock, below even the low end of its expected IPO pricing range, citing concerns about the company’s growth rate. Bhatia said he wanted to provide an “independent view” of Zynga at a time when its bankers and the company will be selling the deal to clients.

“It’s not to say the stock can’t do well initially,” he said.

Wedbush’s Pachter, meanwhile, said it’s “really premature” to call the death of a four-year-old industry.

“No one has enough data to say growth is stalled,” he said.


Nakashima reported from Los Angeles.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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