Sony's (NYSE: SONY) stock closed at $133.75 a share, its highest price in more than two decades, on Jan. 5. The record-setting results of the film Spider-Man: No Way Home, robust demand for the PlayStation 5, and the inflation-driven rotation toward higher-quality blue-chip stocks all drove that rally.
However, Sony's stock price subsequently retreated more than 20% after Microsoft (NASDAQ: MSFT) agreed to buy Activision Blizzard (NASDAQ: ATVI). The $68.7 billion acquisition will make Microsoft the world's third-largest gaming company by revenue after Tencent and Sony, and it could potentially lock in future Activision games as Xbox and Windows exclusives.
But did investors overreact and prematurely dump a high-quality stock ahead of its third-quarter earnings report on Wednesday, Feb. 2?
Source Fool.com