Analyst downgrades Activision’s share rating

Aside from pulling in a tidy $500 million for Black Ops 2’s first day of retail, Activision’s share rating has been downgraded by a financial analyst.

The black mark comes courtesy of Arvind Bhatia, a financial analyst with Sterne Agee. According to Bhatia, Black Ops 2 sales look to be 15% down on Modern Warfare 3’s, which were 5% down on the first Black Ops.

But this is where it gets confusing – Black Ops 2’s $500 million 1st day haul was a full $100 million more than Modern Warfare 3’s. Despite being on a sharper downturn in terms of sales, it’s still pretty much guaranteed to pull in an enormous profit for Activision.

However, according to the analyst, the Call of Duty franchise makes up an astonishing 45% of Activision’s total earnings – the remainder most likely being Blizzard’s revenue and those other games Activision makes (what are they again?). With that in mind, the downward trend is “a cause for concern”, and Sterne Agee has taken Activision’s share rating from “buy” to “neutral”.

Their 2013 estimates for the company are also down from $4.74 billion to “only” $4.3 billion. I guess this is why I don’t have a BCom.