Wilson says Electronic Arts (ERTS) is losing market share because they’re struggling with innovation and product quality. This company used to be the best in the space, but it doesn't look as attractive now.
Jeff Macke suggests that ERTS stands to benefit from the unexpected success of the Ninetendo Wii (NYDOY)… (The popularity of Wii caught many by surprise, and consequently the demand for Wii games is larger than the supply.)
Jeff says, “doesn’t that push back explosive growth for these guys by a couple quarters as Wii games are published.”
Wilson doesn’t think ERTS will benefit. Instead he likes THQ Inc.(THQI) in the video game space because of strong margins and low expectations.
Dylan asks about the retailer, GameStop (GME) which has performed well.
Wilson says GME’s success is tied to used games. For that reason he thinks the publishers will outperform retailers such as GameStop over the next 12 months.
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Trader disclosure: On May 14, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Strazzini Owns (HLT), (MER);Bolling Owns (ICE), (NMX), (XOM), Gold, Silver, Coffee, Sugar Bolling Is Short S&P Futures Bolling Is Short Nasdaq Futures
Pacific Crest Securities Is A Market Maker In (ATVI), (ERTS), (THQI),(TTWO)