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Activision Blizzard (NAS:ATVI) Owner Earnings per Share (TTM)

: 1.35 (As of Sep. 2022)
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In 1986 Berkshire Hathaway Shareholder Letter, Warren Buffett defined owner earnings as follows:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in (c))...Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes - both for investors in buying stocks and for managers in buying entire businesses...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

Activision Blizzard's Owner Earnings per Share (TTM) ended in Sep. 2022 was $1.35. It's Price-to-Owner-Earnings ratio for today is 55.07.


The historical rank and industry rank for Activision Blizzard's Owner Earnings per Share (TTM) or its related term are showing as below:

ATVI' s Price-to-Owner-Earnings Range Over the Past 10 Years
Min: 10.24   Med: 24.42   Max: 58.24
Current: 55.33


During the past 13 years, the highest Price-to-Owner-Earnings ratio of Activision Blizzard was 58.24. The lowest was 10.24. And the median was 24.42.


ATVI's Price-to-Owner-Earnings is ranked worse than
83.87% of 217 companies
in the Interactive Media industry
Industry Median: 16.51 vs ATVI: 55.33

Activision Blizzard's Earnings per Share (Diluted) for the three months ended in Sep. 2022 was $0.55. Its Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2022 was $2.13. It's PE Ratio ratio for today is 34.91.

Activision Blizzard's EPS without NRI for the three months ended in Sep. 2022 was $0.55. Its EPS without NRI for the trailing twelve months (TTM) ended in Sep. 2022 was $2.13. It's PE Ratio without NRI ratio for today is 34.91.


Activision Blizzard (NAS:ATVI) Owner Earnings per Share (TTM) Historical Data

The historical data trend for Activision Blizzard's Owner Earnings per Share (TTM) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Activision Blizzard Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Owner Earnings per Share (TTM) Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.39 1.84 1.93 2.36 2.26

Activision Blizzard Quarterly Data
Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22
Owner Earnings per Share (TTM) Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.09 2.26 2.08 1.69 1.35

Activision Blizzard (NAS:ATVI) Owner Earnings per Share (TTM) Competitive Comparison

For the Electronic Gaming & Multimedia subindustry, Activision Blizzard's Owner Earnings per Share (TTM), along with its competitors' market caps and Owner Earnings per Share (TTM) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Activision Blizzard (NAS:ATVI) Owner Earnings per Share (TTM) Distribution

For the Interactive Media industry and Communication Services sector, Activision Blizzard's Owner Earnings per Share (TTM) distribution charts can be found below:

* The bar in red indicates where Activision Blizzard's Owner Earnings per Share (TTM) falls into.



Activision Blizzard Owner Earnings per Share (TTM) Calculation

In 1986 Berkshire Hathaway Shareholder Letter, Warren Buffett defined owner earnings as follows:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume. (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in (c))...Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes - both for investors in buying stocks and for managers in buying entire businesses...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

To make it simple, then you will have:

Owner Earnings per Share (TTM) = (Net Income + Depreciation, Depletion and Amortization + Change In Deferred Tax - 5Y Average of Maintenance Capital Expenditure + Change In Working Capital) / Shares Outstanding (Diluted Average)

Activision Blizzard's Owner Earnings per Share (TTM) Calculation:

TTM / Last Quarter Average of Last 20 Quarters
Net Income 1,674
Depreciation, Depletion and Amortization 315
Change In Deferred Tax -213
5Y Average of Maintenance Capital Expenditure 88
Change In Working Capital -624
Shares Outstanding (Diluted Average) 789

1. Start with "Net Income" from income statement. Activision Blizzard's Net Income for the trailing twelve months (TTM) ended in Sep. 2022 was $1,674 Mil.

2. "Depreciation, Depletion and Amortization" is from cashflow statement. Activision Blizzard's Depreciation, Depletion and Amortization for the trailing twelve months (TTM) ended in Sep. 2022 was $315 Mil. This needs to be added back because company does not actually need to pay cash for it. It is a non-cash item.

3. Other non-cash charges usually include "Stock Based Compensation" and "Change In Deferred Tax":
However, to be conservative, GuruFocus will not add Stock Based Compensation back to net income. Activision Blizzard's Change In Deferred Tax for the trailing twelve months (TTM) ended in Sep. 2022 was $-213 Mil.

4. Average maintenance capital expenditure over a business/industry cycle: 5-Year Average Maintenance Capital Expenditure = $88 Mil

It is usually best to take a long-term average of maintenance capital expenditure. Ideally this would be as long as 10 years and include at least one economic downturn. However, since many companies do not have as long as 10-year history, here GuruFocus uses the latest 5 years data to do the calculation. To smooth out unusual years but reflect recent developments, we take an average of the 5 year maintenance capital expenditure.

The following shows how to get maintenance capital expenditure.

First, calculate the revenue change regarding to the previous year. If the revenue decreased from the previous year, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
Second, if the revenue increased from the previous year, then calculate the percentage of Net PPE as of corresponding Revenue.
Growth Capital Expenditure = Percentage of Property, Plant and Equipment as of corresponding Revenue * Revenue Increase
Third, calculate Capital Expenditure (positive) - Growth Capital Expenditure.
If [Capital Expenditure (positive) - Growth Capital Expenditure] was negative, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
If [Capital Expenditure (positive) - Growth Capital Expenditure] was positive, then the Maintenance Capital Expenditure = Capital Expenditure (positive) - Growth Capital Expenditure.
Fourth, get the average of the 5 years maintenance capital expenditure.

Activision Blizzard's 5-Year Average Maintenance Capital Expenditure = $88 Mil

5. "Change In Working Capital" is from cashflow statement. Activision Blizzard's Change In Working Capital for the trailing twelve months (TTM) ended in Sep. 2022 was $-624 Mil.
Note: GuruFocus' Change in Working Capital is provided by Morningstar. It is calculated by adding the items under "Change in operating assets and liabilities" (may refer to a different name for different company) section in Cash Flow Statement from original financial report. And sometimes it includes non-current parts of assets and liabilities.

6. Activision Blizzard's Shares Outstanding (Diluted Average) for the months ended in Sep. 2022 was 789.000 Mil.

Activision Blizzard's Onwer Earnings Per Share for Sep. 2022 is calculated as:

Owner Earnings per Share (TTM)
=( Net Income+Depreciation, Depletion and Amortization+Change In Deferred Tax
=( 1674 +315+-213
-5Y Avg of Maintenance CAPEX+Change In Working Capital )/Shares Outstanding (Diluted Average)
-88.129680192204+-624)/789.000
=1.35

Price-to-Owner-Earnings=Current Price/Owner Earnings per Share (TTM)
=74.35/1.35
=55.07

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Assumption: Companies usually do not report maintenance capital expenditures and growth capital expenditures separately. Here we use estimated numbers and average them over 5 years. The method to estimate maintenance capital expenditures can be found in above part 4.

Note: GuruFocus' Change In Working Capital is provided by Morningstar. It is calculated by adding the items under "Change in operating assets and liabilities" (may refer to a different name for different company) section in Cash Flow Statement from original financial report. And it includes non-current parts of assets and liabilities.


Activision Blizzard Owner Earnings per Share (TTM) Related Terms

Thank you for viewing the detailed overview of Activision Blizzard's Owner Earnings per Share (TTM) provided by GuruFocus.com. Please click on the following links to see related term pages.


Activision Blizzard (NAS:ATVI) Business Description

Activision Blizzard logo
Address
2701 Olympic Boulevard, Building B, Santa Monica, CA, USA, 90404
Activision Blizzard was formed in 2008 by the merger of Activision, one of the largest console video game publishers, and Blizzard, one of largest PC video game publishers. The combined firm remains one of the world's largest video game publishers. Activision's impressive franchise portfolio includes World of Warcraft, which boasts more than $8 billion of lifetime sales, and Call of Duty, which has sold over 175 million copies across 14 titles over 12 years.
Executives
Meservey Lulu Cheng director 2701 OLYMPIC BOULEVARD BUILDING B SANTA MONICA CA 90404
Bulatao Brian officer: Chief Administrative Officer C/O ACTIVISION BLIZZARD, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Dixton Grant Michael officer: Chief Legal Officer C/O ACTIVISION BLIZZARD, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Zerza Armin officer: Chief Financial Officer C/O ACTIVISION BLIZZARD, INC 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Macartney Claudine officer: Chief People Officer AMERICAN INTERNATIONAL GROUP, INC. 175 WATER ST. NEW YORK NY 10038
Ostroff Dawn director 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 91405
Yang Jesse officer: Chief Accounting Officer C/O ACTIVISION BLIZZARD, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Alegre Daniel officer: President and COO 9800 59TH AVENUE NORTH MINNEAPOLIS MN 55317
Wereb Stephen G officer: Principal Accounting Officer C/O ACTIVISION, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Walther Christopher B officer: Chief Legal Officer C/O ACTIVISION BLIZZARD 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Bowers Reveta F director C/O ACTIVISION BLIZZARD, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Johnson Collister officer: President and COO C/O ACTIVISION BLIZZARD, INC. 3100 OCEAN PARK BOULEVARD SANTA MONICA CA 90405
Neumann Spencer Adam officer: Chief Financial Officer SIERRA INCOME CORPORATION 375 PARK AVE., SUITE 3304 NEW YORK NY 10152
Asac Ii Lp 10 percent owner C/O CHADWICK & COMPANY 225 HIGHWAY 35, SUITE 102C RED BANK NJ 07701
Asac Ii Llc 10 percent owner C/O CHADWICK & COMPANY 225 HIGHWAY 35, SUITE 102C RED BANK NJ 07701

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