EA
Electronic Arts
Content / Subscription
★ Quality 48/100Price today
$208.97
what the market pays
Worth
$98.80
calculated cycle value
Price is 112% above its value
charlieapp.co
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Content and entertainment
$98.80
per share
How it's calculated
Electronic Arts — high assistant path (2026-06-07). Review note.
Total calculated value
business + cash
How many times the cash flow
Content / Subscription · vs 6 peers
You pay 22.8x times this business's cash flow; its sector median is 17.4x.
53% above what Charlie thinks it's worth (10.8x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $9.18/share × 10.8x multiplier = $98.80 in intrinsic value. Today's price of $208.97 is 53% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 112% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $93.86.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$79.04
-20% off Value
🟡 Discounted
≤$93.86
-5% off Value
🔴 Today
$208.97
-53% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
EA sells the same game every year and charges digital admission with no end in sight.
Electronic Arts makes video games and squeezes them dry with franchises that get milked every year: EA Sports FC (formerly FIFA), Madden, The Sims, Apex Legends. It charges for the base game and, above all, for recurring digital content — Ultimate Team and microtransactions are the real engine. $7.5B in revenue, 79% gross margin.
The moat lives in the sports licenses and the network effects of its online modes. Madden holds the exclusive NFL license; millions of players come back every season out of habit and for their accumulated progress. It's not a wide moat — lose the FIFA license and suddenly you're competing head-to-head.
Revenue history
From $7.0B to $7.5B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $7.5B · FY2026
Of every $100 in sales, $88 goes to costs and operations; $12 is left as net profit (12% margin).
Catalysts and risks
EA Sports FC without the FIFA brand: the first real test of whether the franchise retains players without the historic name.
New Battlefield planned for FY2026 — a big launch moves the needle in a $7.5B business.
Growth in recurring content revenue (live services), which already dominates the mix and carries a 79% margin.
Anemic growth: revenue nearly flat for five years. You're paying for a company that barely moves.
Dependence on few franchises. If Apex or EA Sports FC stumble, the hole is hard to fill.
Regulation of loot boxes and microtransactions in Europe — directly targets the most profitable part of the business.
Charlie's note
“A money-printing machine tied to licenses it doesn't own and to 2% growth. Good business, price that already prices in the good stuff; I'd wait for the market to get bored.”
Analysis · June 2026
So when would be a good price for Electronic Arts?
By our calculation, not yet. We will email you the day it drops to $93.86 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.