Over the five years before the acquisition, investors valued Activision at an average of 23 times estimated earnings.
For analysts following Activision Blizzard Inc., it’s almost as if the video-game company never decided to sell itself to Microsoft Corp. for $69 billion.
As investors increasingly doubt whether the deal will survive antitrust scrutiny, Wall Street brokerages have been growing more bullish on Activision’s standalone prospects. Their average 12-month price target for the stock is $92.17, almost identical to their $91.95 prediction on Jan. 17, the day before Microsoft shocked the market with the takeover announcement.
Should Microsoft’s $95-a-share cash offer fail, arbitragers tend to see the stock dropping back toward $60, where it traded before the bid, said Aaron Glick, a merger-arb specialist at Cowen & Co., from $75.76 Friday. Yet it might not stay there…
