Took a flyer today on some ZNGA calls going into earnings. In my view, the earnings themselves will be whatever they'll be - I suspect very good numbers - but that's baked in to the stock anyway. The whole thing lately is Zynga as a Facebook tie-in.
Which is ironic enough since just a month ago that was considered a big liability. That they make so much of their money from Facebook. And of course, they should diversify as best they can in terms of where they get their revenue, by platform.
But since the news of Facebook's $75 - $100B IPO to come, the valuation for Zynga looks small, considering they're the most savvy game developer for Facebook, and the trend of "casual gaming" has been tossing the traditional video game developers' salad for the last two years ( TTWO ATVI ERTS for instance).
Their product is high quality and they've done an amazing job harnessing the social aspect of games with their seamless Facebook integration. In my view they are worthy of a lofty valuation. I think on earnings we'll see a pop above $15, but possibly above $16.