Games Workshop Share Discussion Threads

[woozle1] 14/8/2019 11:33

Nod .. check out how many economies now have 10 year negative interest rates .. they include Germany, France, Holland and Switzerland .. Greece 10 year is at 2% !
.. and lots of other below 1% .. India is the only stand out at 6% .. we live in odd times .. w1

[nod] 14/8/2019 10:58

I'm increasingly concerned about the decline in consumer spending around the globe - this is potentially a weight on GAW. Many of the economies we rely on have political problems and leadership elections looming. Some economies are technically growing but business confidence has been low for some time and is now affecting consumers. The talk of negative interests by economists and financial reporters around the globe also concerns me. I fell off my chair when our Reserve Bank Governor lowered OCR to an unexpected 1% and then suggested that "neg rates" may be on the cards. We are a growing economy; we rarely had bank rates below 10% prior to 2018 and then only 7%. We are now 1% with a warning of neg rates.

[richred_uk] 12/8/2019 10:56

Good Call (Edited RNS BELOW)

Mon, 12th Aug 2019 09:08

RNS Number : 7022I
Games Workshop Group PLC
12 August 2019

TR-1: Standard form for notification of major holdings

3. Details of person subject to the notification obligation Name Tom Kirby

Resulting situation on the date on which threshold was crossed or reached 3.98%

Position of previous notification (if applicable) 4.75%

[nod] 09/8/2019 14:03

A 250,000 trade. Could it be Tom?

[cockerhoop] 09/8/2019 08:41

So much for the currency headwinds Peel Hunt were alluding to in the fairly recent past :-)

[nod] 09/8/2019 03:31

GBP continues to fall. In three months GBP has lost 7% against USD and EUR. 11% against JPY (hope sales are growing in Japan).

[nod] 07/8/2019 09:39

The big news here today is the New Zealand Reserve Bank reducing interest rates by a full half percent to 1%. This is a record low for NZ much lower than after the GFC. Nobody forecast this. The kiwi dollar fell as did the Australian dollar. Our economies are only loosely coupled but there is anxiety about the impact of the ongoing trade wars.

[nod] 06/8/2019 00:18

It's a bloodbath out there and more to come I would guess. Trump underestimates the resilience of China. Chinese leaders don't need to worry about keeping voters happy. Trump does. Who will give in first?GAW was little affected by the selling today. A bit of a surprise given the profits that many funds have made here. Techs and Agriculture are in the crossfire.

[cockerhoop] 03/8/2019 14:35

Edison forecasts are proving to be almost identical to Peel Hunt's so are both being guided with the same conservative line from the company.

It was clear speaking to KR at last years agm that internal targets were well ahead of the market forecasts which were £200.2m revenue at the time & a 10% reduction on 2017 numbers. I guessed at the time £250m was possible and even that has proved to be conservative.

So the fact the company are already guiding analysts for modest revenue growth this year rather than a 10% contraction is positive imo.

[nod] 03/8/2019 02:16

Edison are hired and paid by the companies they write for. You would expect the report to have good and reliable inside knowledge. The forward estimates are likely based on what GW tells Edison in interviews. GW has always been conservative in its forecasts. We have experienced dramatic changes in consumer sentiment resulting in lean years.

[push n run] 02/8/2019 19:42

I don't blame Edison for being conservative. But i'd be astonished if we don't beat that.

[robinnicolson] 02/8/2019 19:06

The latest research note from Edison is available for download here:

[cockerhoop] 02/8/2019 12:30

If revenue increases by 5% in each of the next 2 years they'll be an awful lot of brand new plastic injection moulding machinery sitting idle in NG7 :-)

[robinnicolson] 02/8/2019 11:43

Edison new forecasts:

"Against tough prior year comparatives and in light of macroeconomic uncertainties, we continue to factor in potentially overcautious sales growth assumptions".

FY20
Revenue: £267.6m
PBT: £85.2m
EPS: 210.3p
DPS: 162p

FY21
Revenue: £278.9m
PBT: £89.8m
EPS: 221.7p
DPS: 171p

DCF valuation: 4703p

[robinnicolson] 02/8/2019 11:16

Looking at the past 5 years, the P/E ratio for GW is 14.7, still less than the market average. Only during the past 18+ months has the P/E expanded significantly. In 2017 the P/E was 9.8.

[sd_anon] 02/8/2019 10:11

The past 5 years has been greatly different to the 5 years before that (you might have noticed the share price has changed a bit over the the past few years!?)

If I thought GAW had no more growth in them then I would agree the valuation is too high, time to sell up.

In my view (and it would appear the market agrees) there are phonomonal opportunities for growth ahead. Organic growth in established markets, immature markets not yet fully exploited (as discussed in the annual report) as well as huge potential in licensing. Future expectations are immensely positive IMO so I remain a long term holder.

[zoolook] 02/8/2019 08:18

Quite Robin. And if it is perceived to go ex-growth with a flat trading statement then it could conceivably re-rate to that PE which would be a 40% share price drop from where we are now. Hopefully not but even the CEO (sensibly) states he can’t guarantee topping 3 years of mega growth with a PE rerating from 13 to 25 that has supercharged the share price

It seems to me that talk of takeover by Disney is far fetched. GAW’s is very distinct and of itself and so the synergies for a buyer in the same or similar sector limited. As commented above private equity seems more likely as the management doesn’t appear to fully embrace its listed status and who could blame them.

[skirbell] 02/8/2019 08:00

I'm not sure Disney would be interested here. GAW have a large and detailed IP but it isn't well known outside of the gaming industry and therefore you have to question the value to Disney. Star Wars and Marvel already had a large following and despite the large price tag on the purchase, Disney could see how they could quickly cover their investment. People have been queuing up to see the likes of Iron Man and Luke Skywalker as their so iconic and well known. A story around the Ultra Marines Space Chapter? Probably not going to get the same pull.

The GAW IP was also built around a game and these don't always port well into the film industry. If we look at the proposed Eisenhorn TV series, they've had to boil the entire IP down to a tiny facet to be able to present it.

[robinnicolson] 01/8/2019 22:15

"gaw have always traded at a high p/e"

The average P/E for GAW during the past 10 years is 13.5

[sd_anon] 01/8/2019 20:43

On the topic of valuation, gaw have always traded at a high p/e. A symptom of the high cash conversion from profits. As they say 'revenue is vanity, profit is sanity but cash is King'.

[sd_anon] 01/8/2019 20:37

W1 I think GAW have woken up to that themselves! Can't wait to hear what other licensing deals might be in the pipeline.

[woozle1] 01/8/2019 17:57

There is such mine of content going back 40 years and it would give Disney a very firm foothold in the Chinese market. Sooner or later someone will wake up to this.

[red5] 01/8/2019 17:06

I think Disney would see warhammer an untappped well, if they so wished to exploit the merchandising for a film with these kinds of numbers could you imagine the potential unleashed for warhammer movies.

[woozle1] 01/8/2019 14:22

Asia is a deep market for this genre. woW madd big money there and flopped in the West.

[nod] 01/8/2019 13:26

W1, great minds think aloft.