Zynga Inc. Company Financial Performance Case Study

Zynga Inc. Company Financial Performance Case Study

Case 2 Zynga Inc. Buy/Sell/Recommend

You will be operating in your SECOND TEAM groups for this case in order to switch things up and balance your workloads between your projects and your weekly assignments. Note the weekly assignments will decrease in the next few weeks and we’ll work more on cases in class. This case doesn’t cost any money , but you’ll likely have to ask me questions.

This case is a response to your requests to think about investment decisions and how to evaluate stocks.

 Teams 1, 2 and 3: Please present a 2 page summary note (like a financial analyst) of why Zynga is a “Buy”. In addition to the two pages of text, please provide a high level financial model supporting your decision. You will need to consider the total capitalization of the company, the financial statements, and the cash position of the company in coming to this recommendation. I want to see that you understand the financial statements, the sources of revenue and growth, and how Zynga uses its capital. Use the stock price as of the close of market tomorrow (2/15/19) as your basis for your recommendation. This is a long term view, not a market timing/momentum view (don’t say because it’s at or near a 52 week high it has limited upside, for example).

Teams 4, 5 and 6: You are presenting a 2 page summary supporting a “Sell” recommendation on Zynga-i.e., at its current valuation it’s overvalued in the long term. Again, use close of market on 2/15/19 as your basis for the valuation.

 Teams 7, 8 and 9: You have a different challenge: I want you to come up with a recommendation and analysis of Zynga. Buy, sell or hold. You will do a similar analysis of Zynga but will need to make a recommendation based on your analysis, not be supporting one view or another. mation on Zynga includin