Here’s the weekly ranking check for our top-pick G5 Entertainment. So far in November, G5 has released a large amount of new games across all platforms. Please note that our screening only takes iOS games into consideration, i.e. Google Play, Kindle and Nook have to be followed separately.
A very positive develoment this week has been “Doomsday Preppers” move upwards in the top grossing lists. In the very important US market, the game is right now #242 for iPhone and #260 for iPad and has improved steadily over recent days. The game is also ranked #135 top grossing game for iPad in Brazil. Let’s hope that more and more people are prepping for Doomsday…
We are screening the app markets of Australia, Brazil, Canada, China, France, Germany, Italy, Japan, Netherlands, Russia, South Korea, Spain, Sweden, UK and USA).
Number of G5 Entertainment games among the top grossing charts for iOS:
We also want to remind our readers that G5 Entertainment is a stock that has shown a clear historical pattern in the past. As you can see in the graph below, G5 Entertainment has always started to trade significantly higher in January of each year (it doubled both at the beginning of 2011 and at the beginning of 2012). Why is that so? G5 Entertainment always issues a preliminary quarterly result statement a few days after the actual end of each quarter (i.e. around January 3rd). So at the beginning of each year, investors get to hear that G5 has actually achieved its targeted revenue and earnings levels and the market starts to focus on the coming year. Furthermore, the holidays are THE most important part of the year for app sales in general. People unwrap their new smartphones and tablets and start to fill them with content. This goes usually along with very positive newsflow around the app industry in total and G5 Entertainment in particular.
It is usually uncommon that the market is so short-sighted and only looking at the current year’s earnings potential for a company but in small-cap names that are listed on smaller exchanges, like G5 is, investors are usually less sophisticated and have in the past acted under the theme “seeing is believing”. We could spend hours now and here to argue why this is wrong etc etc but rather than doing that we think it is more important to just accept the fact that it is like that. And the good news is: we are approaching that time of the year again. You can decide for yourself if you want to follow the crowd and jump on the train when it has left the station in early January or if you want to be one step ahead. If you choose the latter than the coming days and weeks are the perfect entry point into this fast growing, profitable, debt free stock that is trading at a ridiculously low 12m-forward PER of around 8x.
Finally, don’t forget that it is time to nominate your favourite G5 Entertainment games for the prestigious bestappever awards 2012. Games can be nominated in different categories (for more information see our recent article: http://nordicinvestor.net/2012/11/24/g5-entertainment-time-nominate-bestappever-awards).