The Zacks Analyst Blog Highlights: Zynga, Synacor, Facebook, Majesco Entertainment and Electronic

     The Zacks Analyst Blog Highlights: Zynga, Synacor, Facebook, Majesco
                         Entertainment and Electronic

PR Newswire

CHICAGO, Dec. 6, 2012

CHICAGO, Dec. 6, 2012 /PRNewswire/ announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include Zynga Inc. (Nasdaq:ZNGA), Synacor
Inc. (Nasdaq:SYNC), Facebook (Nasdaq:FB), Majesco Entertainment (Nasdaq:COOL)
and Electronic Arts (Nasdaq:EA).


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Here are highlights from Wednesday's Analyst Blog:

Zynga Partners Synacor

Social game developer Zynga Inc. (Nasdaq:ZNGA) recently signed a partnership
deal with Synacor Inc. (Nasdaq:SYNC), a cloud-based television services
provider. Synacor's cloud-based platform enables cable, satellite and telecom
companies to deliver entertainment services and apps to their subscribers
across multiple devices. The partnership will enable subscribers to directly
access Zynga's home page, games and in-game currency beginning 2013.

Social games, which are mostly free-to-play, primarily earn revenue from the
sale of in-game currency that is used by players to purchase virtual items,
power-ups and energy while playing. Zynga currency (also called credit) is
used in most of its games namely Zynga Poker, Words With Friends, FarmVille2,
ChefVille, CityVille, Bubble Safari and Ruby Blast.

Although the financial terms of the deal were not disclosed, such as revenue
sharing of the in-game transactions between the two companies, we believe that
the increasing usage of in-game currency will boost Zynga's top-line growth
going forward.

The partnership comes at an opportune time for Zynga. The company recently
lost its exclusivity to Facebook (Nasdaq:FB), which is a serious setback,
considering the fact that the social networking platform has been its primary
source of revenue over the last few years (currently 85.0% of Zynga"s traffic
and 92.0% of its revenue). The Synacor deal will not only reduce Zynga's
dependence on the Facebook platform but will also expand its customer base
going forward.

Synacor has a strong clientele of approximately 45 cable, satellite and
telecom companies that include names such as Verizon and Charter. Its service
reaches approximately 24 million households who have access to high-speed
Internet. We believe that the partnership will allow Zynga to reach a sizable
audience over the long term.

Lately, Zynga has been criticized for the lack of new and diversified gaming
content, which is failing to attract new users. We believe that increasing
penetration will attract new game developers, which will improve gaming
content over the long term. We believe that the deal will also promote Zynga
currency as a suitable alternative to Facebook Credit for many game
developers, thereby boosting in-game transactional revenue going forward.

Over the last 12 months, Zynga has been entering into partnership deals in
order to gain momentum in the social, free-to-play and casual gaming market.
In October 2012, Zynga entered into a partnership deal with Gibraltar-based
online gambling company to offer real-money poker and casino-style
games in the U.K.

In May, Zynga teamed up with American Express and created a new platform
called Serve. In June 2012, the company announced a new network (Zynga with
Friends) and also started providing programming tools to third party
developers to publish online mobile games. Zynga also announced partnerships
with Majesco Entertainment (Nasdaq:COOL) and Atari.

However, we note that growth from these partnerships will take some time to
materialize. In between, its games continue to lose popularity and money amid
stiff competition from established players such as Electronic Arts
(Nasdaq:EA). Further, the revised terms with Facebook (despite all Zynga
initiatives to reduce exposure) will remain an overhang on the stock in the
near term.

We remain Neutral on Zynga over the long term (6-12 months). Currently, Zynga
has a Zacks #3 Rank, which implies a Hold rating in the short-term (1-3

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