in Mobile Gaming

#G5 Entertainment: The story continues

G5 Entertainment games are selling well. This morning’s press release was another confirmation of that and the fact that the company increased its forecast for Q1 2012 shows that the development is even outperforming their own expectations. Management did not comment on the full year guidance for 2012 but with the first quarter of the year “in the bag”, we think the targeted SEK 87m in revenue for 2012 are more than realistic.  In a major effort, the company aims to increase its gaming portfolio to “over 300 apps” by the end of the year. 

The year was off to a good start and the recently published games are selling well across the different platforms and regions. As a sample, I have attached some rankings for G5 games from this morning:

iPad top grossing ranking China:

 

iPad top grossing Germany:

iPad top grossing UK:

iPad top grossing Japan:

iPad top grossing Sweden:

We are convinced that the market will sooner or later revalue the G5 share as the company is performing in-line or even ahead its 2012 targets. The first quarter is behind us and it was another successful one for G5. The share is still valued at below 13x forward looking earnings, which stands out as extremely cheap. G5 competitor Glu Mobile is currently valued at 26x expected 2013 earnings (using US analysts consensus estimates). Why not starting to value G5 at 26x 2012 earnings to begin with?

Nordic Investor

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