Would You Rather Buy a Struggling Game Company or a Struggling Grocery Chain?
Zynga (ZNGA), maker of FarmVille and Words With Friends, forecast a loss in the third quarter and lowered its financial outlook.
Wall Street had been expecting a break-even quarter, not a net loss of $90 million to $105 million. So investors promptly punished the stock.
And here’s the longer view.
Smart-ass investors immediately started joking that Zynga stock is cheaper than some of the fake currency it offers in its games. Right, and it’s also cheaper than Supervalu (SVU).
Don’t bother charting PE. Neither have earnings.