Here’s What You Should Know About Zynga Inc (ZNGA) Now

Page 2 of 2

Here’s the bottom line: If you believe Zynga’s stock was properly valued prior to the announcement, then a 18% “Hattrick premium” seems pretty reasonable. If you believe (as I do) that the enormous challenges and uncertainty facing Zynga’s aren’t fully reflected in the price, the appointment of a new CEO will do little to get you excited. It’s impossible to make any forecast of what Zynga will earn five years from now (one can’t even be certain the company will still exist), so any intrinsic value estimate on a cash flow basis is meaningless. Make no mistake about it: Buying shares of Zynga today is no different from playing virtual roulette — with real money, that is.

The article Here’s What You Should Know About Zynga Now originally appeared on Fool.com and is written by Alex Dumortier, CFA.

Fool contributor Alex Dumortier, CFA has no position in any stocks mentioned, and neither does The Motley Fool. You can follow Alex on LinkedIn.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Page 2 of 2