Starcraft II not Diablo III is the Catalyst
David Gardner has recommended multiple times Activision (now known as Activision Blizzard) as an excellent investment and he was right on the money.
And he's still right to recommend it even more so after the merger. The stock is red hot.
However, I emplore everyone to set up your profit expectations for selling some of your shares off right now if you are like me and you recently got into the stock on the dip around $10.40 or less.
David Gardner is wrong to say Diablo II is the catalyst. Sure, that game is hugely popular and it will sell like hot cakes.
But.. go back to the day Starcraft released after Diablo.
That may happen again... Starcraft II may release after DIABLO III.
My point is for investors to not bail out on their ATVI stock 1-2 weeks before Diablo III's release date.
Starcraft II is going to send the stock up regardless of share price at around 5-10%. I wouldn't be surprised if it goes as high as 15% more than what DIABLO III does to the stock.
1) Read up on the South Korean Craze over Starcraft. It was bigger in Korea than it ever was in America and America loved Starcraft more than Diablo.
2) Starcraft II is doing something that DIABLO III is not. They are simultaneously releasing 2 expansion packs to the game the day Starcraft II releases and bundling them in a "Trilogy" package. This trilogy package will do to Starcraft's profits things DIABLO III can't even dream of.
3) The expansion packs to Starcraft II are also sold separately and become long term income over the 2 quarters after Starcraft II releases for buyers of the stand alone game.
Starcraft's expansion packs widen the catalyst way beyond just the first month's sales revenue.
Diablo III will just get bought in the 1st month and suffer sales declines afterwards.
4) Starcraft II introduces Customizeable Map Creation for the battlefields in the game. This not only creates a community of gamers designing and sharing the maps they create thus giving the game a longer lifespan than DIABLO III... But it possibly could open the door for even more income for ATVI if downloadable Maps produced by Blizzard for $1 a map (whatever they price it at doesn't matter much) is something they end up doing.
I go back to OBLIVION's downloadable content for $1 each on Bethesda's website as an example.
Or HALO 3's downloadable maps for a price.
The real money maker is Starcraft II and that game may not release until after DIABLO III so keep track of the release dates as they become known in the next 6 months (release dates can change) and make sure the bulk of your profit taking is with the right video game.