What's more, Glu Mobile could bring fresh ideas to FIFA Mobile Coins EA about ways to decorate certain titles. The business reported seeing favorable early outcomes from this initiative about the last earnings call. Growth at an unbiased price.It's always worth checking the cost a business is paying when it announces a significant acquisition. Across three hot valuation metrics, Glu Mobile looks just like a good value in the video game industry.EA is paying $12.50 per share in money to Glu Mobile shareholders, which places the latter's price-to-free money flow multiple at 47.
On a forward price-to-earnings basis, Glu trades at a multiple of 25, that looks like a relatively great deal compared to its bigger peer Zynga, which deals at a higher forwards P/E of 28. Glu can also be a better deal on a price-to-sales basis using a multiple only under four, whereas Zynga trades at closer to six times salesup there with the industry's top video game stocks.
EA's got money to spare.EA entered calendar 2021 with plenty of cash to reinvest or acquire elite studios such as Glu to expand its dominance from the gambling market.The company made $1.9 billion in free cash flow over 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, while Glu Mobile should shut during the June-ending quarter. Even after both of these prices are finish, EA will nonetheless have a couple billion dollars' worth of money on the balance sheet with nearly $2 billion in free cash flow coming from every year.The addition of Glu Mobile will jump-start EA's increase in a cell market that grew an estimated 25 percent last year, reaching $86 billion in global revenue, according to Newzoo.In brief, this purchase is a significant update for Digital Arts' mobile game industry, which is the reason why the stock surged to a new high on the news.
In case you spend $1,000 at Glu Mobile right now?Before you believe Glu Mobile, then you are going to want to hear this.Investing legends and Motley Fool Co-founders David and Tom Gardner merely revealed what they believe are the 10 best stocks to allow investors to purchase right now... along with Glu Mobile wasn't among them.The online investing service they have run for almost two years, Motley Fool Stock Advisor, has beaten the stock exchange by over 4X. * And Buy FIFA Coins at the moment, they believe there are 10 stocks that are better purchases.