What's more, Glu Mobile may bring new ideas to EA about FIFA Mobile Coins ways to monetize certain names. The business reported seeing favorable early outcomes from this initiative about the last earnings call.
Growing at a fair price.It's always worth checking the price a company is paying when it declares that a significant acquisition. As Warren Buffett has said,"Price is what you pay, value is what you receive." Across three hot valuation metrics, Glu Mobile seems just like a fantastic value in the movie game industry.EA is paying $12.50 per share in money to Glu Mobile investors, which puts the latter's price-to-free cash flow multiple at 47.
On a forwards price-to-earnings foundation, Glu trades in a multiple of 25, that resembles a relatively good deal in comparison to its bigger peer reviewed Zynga, which deals in a greater forward P/E of 28. Glu can also be a much better deal on a price-to-sales foundation using a multiple only under four, while Zynga transactions at closer to 6 times salesup with all the industry's leading gaming stocks.
EA's got cash to spare.EA entered calendar 2021 with tons of money to reinvest or obtain top-notch studios like Glu to expand its dominance in the gaming market.The company generated $1.9 billion in free cash flow during the previous four quarters. That's on top of the $6.7 billion in cash and short term investments in the balance sheet at the end of 2020.
Even the Codemasters price is expected to close this month, even while Glu Mobile should shut throughout the June-ending quarter. Even after these two deals are complete, EA will nonetheless have a couple billion dollars' worth of cash on the balance sheet with nearly $2 billion in free cash flow coming from every year.The inclusion of Glu Mobile will jump-start EA's increase in a cell market that climbed an estimated 25% last year, reaching $86 billion in global revenue, based on Newzoo.In short, this acquisition is a major update for Electronic Arts' mobile game industry, which is the reason why the stock surged to a fresh high on the news.
If you invest $1,000 in Glu Mobile directly now?Before you consider Glu Mobile, then you're want to hear this.Investing legends and Motley Fool Co-founders David and Tom Gardner only revealed exactly that which they believe are the 10 best stocks for investors to purchase today... along with Glu Mobile wasn't among them.The online investing service they have run for Buy FIFA Coins almost two decades, Motley Fool Stock Advisor, has conquered the stock exchange by over 4X. * And at the moment, they think there are 10 stocks that are better purchases.