EA Valuation

Electronic Arts Inc

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167.640

+4.89(3.005%)1D

Overview
Forecast
Valuation
Earnings

EA Relative Valuation

EA's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, EA is overvalued; if below, it's undervalued.

Historical Valuation

Electronic Arts Inc (EA) is now in the Undervalued zone, suggesting that its current forward PE ratio of 19.33 is considered Undervalued compared with the five-year average of 19.34. The fair price of Electronic Arts Inc (EA) is between 218.01 to 253.06 according to relative valuation methord. Compared to the current price of 167.64 USD , Electronic Arts Inc is Undervalued By 23.1%.

Relative Value

Fair Zone

218.01-253.06

Current Price：167.64

23.1%

Undervalued

19.33

Trailing

Forward

13.81

EV/EBITDA

Electronic Arts Inc. (EA) has a current EV/EBITDA of 13.81. The 5-year average EV/EBITDA is 13.47. The thresholds are as follows: Strongly Undervalued below 10.28, Undervalued between 10.28 and 11.87, Fairly Valued between 15.06 and 11.87, Overvalued between 15.06 and 16.65, and Strongly Overvalued above 16.65. The current Forward EV/EBITDA of 13.81 falls within the Historic Trend Line -Fairly Valued range.

15.77

EV/EBIT

Electronic Arts Inc. (EA) has a current EV/EBIT of 15.77. The 5-year average EV/EBIT is 15.09. The thresholds are as follows: Strongly Undervalued below 12.07, Undervalued between 12.07 and 13.58, Fairly Valued between 16.60 and 13.58, Overvalued between 16.60 and 18.11, and Strongly Overvalued above 18.11. The current Forward EV/EBIT of 15.77 falls within the Historic Trend Line -Fairly Valued range.

5.11

Electronic Arts Inc. (EA) has a current PS of 5.11. The 5-year average PS is 4.97. The thresholds are as follows: Strongly Undervalued below 3.73, Undervalued between 3.73 and 4.35, Fairly Valued between 5.58 and 4.35, Overvalued between 5.58 and 6.20, and Strongly Overvalued above 6.20. The current Forward PS of 5.11 falls within the Historic Trend Line -Fairly Valued range.

16.60

P/OCF

Electronic Arts Inc. (EA) has a current P/OCF of 16.60. The 5-year average P/OCF is 18.44. The thresholds are as follows: Strongly Undervalued below 12.31, Undervalued between 12.31 and 15.37, Fairly Valued between 21.50 and 15.37, Overvalued between 21.50 and 24.57, and Strongly Overvalued above 24.57. The current Forward P/OCF of 16.60 falls within the Historic Trend Line -Fairly Valued range.

18.05

P/FCF

Electronic Arts Inc. (EA) has a current P/FCF of 18.05. The 5-year average P/FCF is 19.59. The thresholds are as follows: Strongly Undervalued below 12.35, Undervalued between 12.35 and 15.97, Fairly Valued between 23.21 and 15.97, Overvalued between 23.21 and 26.83, and Strongly Overvalued above 26.83. The current Forward P/FCF of 18.05 falls within the Historic Trend Line -Fairly Valued range.

Electronic Arts Inc (EA) has a current Price-to-Book (P/B) ratio of 6.92. Compared to its 3-year average P/B ratio of 4.90 , the current P/B ratio is approximately 41.28% higher. Relative to its 5-year average P/B ratio of 4.90, the current P/B ratio is about 41.23% higher. Electronic Arts Inc (EA) has a Forward Free Cash Flow (FCF) yield of approximately 4.30%. Compared to its 3-year average FCF yield of 4.99%, the current FCF yield is approximately -13.80% lower. Relative to its 5-year average FCF yield of 4.75% , the current FCF yield is about -9.45% lower.

6.92

P/B

Median3y

4.90

Median5y

4.90

4.30

FCF Yield

Median3y

4.99

Median5y

4.75

Competitors Valuation Multiple

The average P/S ratio for EA's competitors is 12.86, providing a benchmark for relative valuation. Electronic Arts Inc Corp (EA) exhibits a P/S ratio of 5.11, which is -60.28% above the industry average. Given its robust revenue growth of 0.66%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

P/S

Revenue Growth

Market Cap

Take-Two Interactive Software Inc

Performance Decomposition

Market capitalization of EA increased by 10.69% over the past 1 year. The primary factor behind the change was an increase in P/E Change from 30.16 to 41.83.

The secondary factor is the Revenue Growth, contributed 0.66%to the performance.

Overall, the performance of EA in the past 1 year is driven by P/E Change. Which is more unsustainable.

0.66%

1.66B → 1.67B

Revenue Growth

-28.69%

16.87 → 12.03

Margin Expansion

38.72%

30.16 → 41.83

P/E Change

10.69%