Amazon Stock Sinks While Zynga Shares Soar
The stocks of a couple of digital companies went in the opposite direction on Friday after each posted quarterly earnings a day prior.
Amazon.com sunk 11 percent to $358.69 after saying it earned 51 cents per share, after certain items, in the most recent quarter while analysts expected 66 cents. Amazon also said it was considering adding up to $40 a year to the cost of its Prime service, which offers shipping discounts and access to streaming movies and TV shows.
On the opposite end of the spectrum was Zynga, the company behind Words With Friends and other popular, casual games played on mobile devices.
Shares of Zynga soared 24 percent to $4.40 on Friday, one catalyst being that the company reported losing 3 cents per share in the most recent quarter while analysts expected it to lose 4 cents.
Zynga stock also rose because the company said it would save money by laying off 15 percent of its staff, and that it struck a deal to pay $527 million for NaturalMotion, a British company that employs 260 people. NaturalMotion makes games like CSR Racing, My Horse and Clumsy Ninja.
On Friday, Janney Capital Markets analyst Tony Wible upgraded shares of Zynga to "neutral" with a fair value of $4.25, in part because he is impressed with moves made by Don Mattrick, who was named CEO in July.
"Our confidence is growing in the new management team's ability to transform the business in the face of next-generation console risk," Wible wrote in a note to clients on Friday. "While execution risk remains, the plan that management laid out suggests this team will continue to make bold and tough decisions, as required."