Electronic Arts Inc. (NASDAQ: EA) is one of the largest creators and marketers of video games. The company offers interactive software for personal computers, tablets, mobile phones and all the major gaming consoles. Some of its best-known titles are "Plants vs Zombies," "Mass Effect," "The Sims" and "Madden NFL." EA made waves by nabbing the coveted rights to make "Star Wars" games for Disney in 2013, although they came under heat in 2017 for overusing a "loot box" system in Star Wars Battlefront 2, angering fans and negatively affecting the company's market value.
EA has a troubled history with its fans. It's been voted the "Worst Company in The World" by a fan-poll on Consumerist.com three times in the last decade. With investors, though, they're as beloved as ever. In January of 2018, Electronic Arts reported net revenue of $3.56 billion for the nine months ending on December 31, 2017, up from $3.31 billion reported for the same period the previous year. As of October 29, 2018, the company boasted a market capitalization of $28.24 billion.
Electronic Arts released its Q2 FY19 earnings on October 30, 2018. The video game company reported $1.29 billion in revenues this quarter, compared to $1.18 million over the same period last year. Here are the company's five largest mutual fund holders.
Vanguard Total Stock Market Index Fund (VTSMX)
The Vanguard Total Stock Market Index Fund (VTSMX) was launched in April 1992.Since then, the fund's assets have grown to $756.6 billion with investments in the entire U.S. equity market, including small-, mid-, and large-cap growth and value stocks. The fund's portfolio of 3680 holdings has 20.1% allocated to the technology sector, 19.1% to financial services, and 13.6% to healthcare. The fund's 7.7 million Electronic Arts shares give it the largest stake in the company, 2.55%, of any investor.
VTSMX has generated a three-year annualized return of 10.57% as of October 2018. Its annual expense ratio stands at 0.14%. VTSMX is most appropriate for investors looking for very broad diversification and exposure to major U.S. corporations at a low expense ratio, and with emphasis on technology and the financial services sectors.
Fidelity Contrafund (FCNTX)
Launched by Fidelity in May 1967, the Fidelity Contrafund is an actively managed large-cap growth fund that seeks long-term capital appreciation. The fund compares its returns to the S&P 500 Index, which it tends to outperform. The fund invests 27.35% of its holdings in the technology sector, 12.53% in consumer discretionary, and 14.88% in financial services. The fund has the second highest number of Electronic Arts shares, with over 5.8 million to its name.
FCNTX has a 10-year annual average return of 13.31% as of October 2018. The fund carries a low-to-moderate degree of risk, but it has the potential to generate high returns. It charges a net expense ratio of 0.74%.
Vanguard 500 Index Fund (VFINX)
The Vanguard 500 Index Fund (VFINX) is a passively managed stock index fund that closely tracks the S&P 500 Index, which consists of the 500 largest U.S. publicly traded companies. The fund allocates about 21% of its assets to the information technology sector, with 15.1% to the healthcare sector and 13.3% to financial services. As of October 2018, the fund owns 5.7 million shares, or roughly 1.56%, of Electronic Arts, making it the third-largest mutual fund holder of the company. VFINX's bet on Electronic Arts accounts for 0.15% of the fund's assets.
VFINX has a three-year annualized return of 10.79% as of October 2018. The fund is managed by the Vanguard Equity Investment Group and charges an annual expense ratio of 0.14%.
T. Rowe Price Growth Stock (PRGFX)
The T. Rowe Price Growth Stock (PRGFX) is a moderate risk fund under the T. Rowe umbrella that seeks to invest at least 80% of net assets in the common stocks of a diversified group of growth companies. The fund allocates 26.3% of its assets to the information technology sector, 14.6% to health care, and 5.6% to financial services. As of October 2018, the fund has 3.9 million shares of Electronic Arts, an investment that accounts for just over 1% of the fund's $49.8 billion portfolio.
PRGFX has a three-year annualized return of 12.11% as of October 2018. The fund is managed by T. Rowe and has an expense ratio of 0.67%.
SPDR S&P 500 ETF (SPY)
The main objective of the SPDR S&P 500 ETF (SPY) is to provide results that generally correspond to the performance of the S&P 500 Index. This is achieved by investing in 500 large cap stocks that give a good idea of what the entirety of the stock market looks like. The fund allocates 20.8% of its assets to the information technology sector, 15.1% to health care, and 13.4% to financial services. As the fifth-largest institutional investor in Electronic Arts, the fund holds 3.5 million shares, or roughly 1.14%, of the company as of October 2018 The investment accounts for 1.02% of the fund's portfolio.
SPY has a five year annualized return of 14.27%, a turnover rate of 3% and an expense ratio of 0.09%.