SAN FRANCISCO (KCBS) – San Francisco-based social gaming firm Zynga saw a boost on Tuesday as word that rival King Digital Entertainment – maker of the wildly popular Candy Crush Saga – filed for an initial public offering.
Shares in the San Francisco-based Mafia Wars and Farmville creator surged to a 52-week high Tuesday, finishing at $5.15 the day King announced its offering and revealed strong profit growth in 2013 – more than $567-million dollars from just $7.9-million in 2012.
While Candy Crush Saga is the most popular game on Facebook, investors won’t forget Zynga’s stock falling from a record high of more than $14 to a range of three to four dollars over the past two years as it has yet to reclaim the popularity of its original Facebook hits.
Analysts have questioned whether Zynga will be able to repeat its string of hit games on mobile platforms as it did for Facebook on the desktop.
Meanwhile, investors may also be wary of Ireland-based King’s reliance on the huge success of the Candy Crush game – 128 million daily users, according to the IPO filing – and the perception that it may be a one-trick pony.
Candy Crush Saga accounted for 78 percent of its gross bookings in the fourth quarter of 2013. Two other games, Pet Rescue Saga and Farm Heroes Saga, combined with Candy Crush to account for 95 percent of the company’s gross bookings.
King set a fundraising target of $500 million for its IPO. It plans to trade on the New York Stock Exchange under the ticker symbol “KING” but company officials did not disclose the stock’s IPO price.