(Bloomberg) -- Electronic Arts Inc. rose nearly 5 percent in pre-market trading as analysts weigh the potential success of the company’s latest free-to-play game, Apex Legends. The game could be a competitor to the wildly popular game Fortnite, Bank of America Merrill Lynch suggested. And Jefferies said Fortnite’s viewership on the video game streaming site Twitch was "basically chopped in half" in the days following the Apex release.

• BofAML analyst Justin Post wrote that EA now has a title "to capitalize on the most important new genre in gaming"
  • He cautioned that "any call on Apex at this early stage is highly speculative" however, "if Apex is a hit, we think opportunity is worth the stock volatility and risk"
  • Expects "new data points (or any lack of data points) to drive big swings in the stock as investors evaluate the Apex potential"
  • Upgraded to buy from neutral, price target boosted to $110 from $95
• Jefferies analyst Timothy O’Shea wrote that Apex Legends is EA’s "hottest game in years" and first week data is strong
  • Apex Legends has the hallmarks of a breakout game for video game streaming site Twitch, namely a free-to-play business model and competitive multiplayer gameplay
  • Fortnite’s viewership on Twitch "basically chopped in half" in days following the Apex release
  • Raises PT to $90 from $80, maintains hold rating
• Buckingham analyst Matthew Harrigan said that "gamers strongly welcomed an appealing alternative to Fortnite and we are confident that the game is a significant success"
  • However, it’s premature to assume that Apex Legends achieves the same economics as Fortnite
  • Boosts PT to $103 from $90, downgraded to neutral from buy
• EA has 22 buys, 12 holds, 0 sells; avg PT $95: Bloomberg data

To contact the reporter on this story: Sebastian Pellejero in New York at spellejero@bloomberg.net

To contact the editors responsible for this story: Courtney Dentch at cdentch1@bloomberg.net, Will Daley

©2019 Bloomberg L.P.