Keywords Studios Share Discussion Threads

[bulltradept] 31/1/2020 08:30

I'd prefer them a little lower perhaps the £12.10 mark.

[scooper72] 30/1/2020 18:38

Bought a few more at the end of the afternoon today. Some at 1295 but more at the better price of 1260. Hope I haven't gone back into early.

[scooper72] 30/1/2020 18:37

Been reading the inferior write up on HL website. They are always very cautious in expressing an opinion. They mention that Net debt is now at 18M which to me sounds quite healthy when taking into account all their acquisitions

[rivaldo] 30/1/2020 11:47

New note from Edison, confirming that EBITDA and PBT were ahead of forecasts.

KWS have lots of headroom for much larger acquisitions than they've made recently - a decent-sized acquisition from existing facilities would bring the rating down very nicely:



Summary:

"Although we expected strong growth in H219, FY19 revenue of €326m, reflecting 30% overall growth and 15% organic growth, represents a sparkling performance. EBITDA and PBT were ahead of forecast at €49.5m and €41.0m, respectively. Given the higher revenue base, we are revising our FY20 revenue estimate up by 4%, but prudently holding operating profit and PBT at previous levels as margins normalise through FY20.

We retain our view that Keywords remains strongly positioned as the only games service provider at a global scale. The company’s P/E rating (25.0x FY20e) reflects its leading market position, track record and potential, and should fall further as Keywords continues its buy-and-build strategy."

"Market leader in a growth industry

As management emphasised at the Montreal capital markets day (CMD), as well as strong industry growth (Newzoo forecasts 8.4% growth 2019–22), Keywords benefits from the growth of outsourcing and increasing market share as a market leader in a fragmented global industry. Growth is further boosted by M&A through Keywords’ successful buy-and-build strategy. With the next console transition in Q420, the medium-term growth outlook remains robust and next week’s London CMD will provide further insight into the opportunities for each of Keywords’ business lines."

[bulltradept] 30/1/2020 11:36

Oh I get that, just that I keep to bigger more established AIM companies, one's making a profit and are more transparent.

[steeplejack] 30/1/2020 11:18

Well if that's the case,it's strange that some funds simply won't touch AIM stocks,it's not allowed in their memorandum of association,the very construct of the fund.The AIM market is a poorly regulated market which has happily entertained fraudulent enterprises like Quindell,which grew to a market cap of over £3bn.Some stocks like ASOS or Majestic Wine have proved to be excellent investments but as a rule,AIM stocks should be approached with deep rooted scepticism.As for KWS,it would do itself a favour if it joined the main market and enhanced its credibility with institutional investors.

[bulltradept] 30/1/2020 10:54

I've never bought the argument about MM's if AIM stocks are big enough (market cap of 750 mil plus), and are liquid enough, I find they trade like ordinary LSE stocks, or perhaps that's just me..

[steeplejack] 30/1/2020 09:46

The figures are pretty much an irrelevance to those that make markets here.I sold stock at £15 recently (not because I had any inherent concerns about the company's model)but because it was becoming increasingly evident that the the protagonists monkeying with this stock,are more than keen to give it a jolly good tonking.So down we go to flirt with recent lows until the inevitable price recovery.It was ever thus in the AIM market.

[phowdo] 30/1/2020 09:42

MS announced 20% fall in gaming revenues last night. Some of which is due to Fortnite distorting things year ago but its clear the console transition lull is here.

[bulltradept] 30/1/2020 09:25

Seems as though they might be indicating a bit of a lull before new consoles?

[scooper72] 30/1/2020 09:09

I'm stocking up with a little more for the SIPP. Probably didn't sell as high as rivaldo but glad to still be in the blue.

[bulltradept] 30/1/2020 08:33

Well that was to be expected...

[rivaldo] 30/1/2020 08:16

Trading statement seems to be ahead of expectations....

Adjusted profit of EUR41m is nicely ahead of Edison's forecast EUR40.2m.

As are revenues of EUR326m, against the forecast EUR319m.

And more acquisitions are likely:

"We fully expect to make a number of selective acquisitions as we continue to build our global video games services platform and we are managing a strong acquisition pipeline as we enter 2020."

I sold some much higher up, but happy to hold the rest as this will be a continued winner over time imho.

[global nomad] 29/1/2020 09:06

has partially picked up on the sentiment shift around gaming and esports but this pull back may be a good time to add or enter the support services part of the sector.

[rivaldo] 28/1/2020 12:31

More detail on the Jefferies upgrade:



"Keywords Studios receives Jefferies boost

The US broker lifted its price target for the stock, which it continues to rate 'buy'

Jefferies nudged up its price target for Keywords Studios PLC (LON:KWS), while repeating its ‘buy’ recommendation, saying the next trading statement should confirm double digit growth an “margin improvement”.

The US broker reckons the stock is worth 1,881p, up from 1,853p and 35% ahead of the current price of 1,391p.

“The market will wait to see acquisition spend inflect, but we're confident [Keywords’] opportunity-set and attractiveness has grown,” analyst Ken Rumph said in a note.

The company, valued at more than £900mln, supplies a range of technical services to computer games developers and publishers.

Some of the services it provides include art services, software engineering, audio services, functionality quality assurance (QA), localisation (enabling games to be published in several languages), localisation QA, and player support.

Among its clients are Sega, Nintendo, Google, Microsoft and Warner Bros.

Established in 1998 it now has studios in more than 42 locations in 20 countries across four continents.

Keywords employs a buy-and-build strategy and has been expanding rapidly since its first acquisition in 2014."

[squintyflinty1] 27/1/2020 16:28

Plenty of upside on this one then.

[aimingupward2] 27/1/2020 12:37

Yes, you're right. My error.

[rivaldo] 27/1/2020 11:32

Jefferies have actually raised the target price to 1881p today :o))

[aimingupward2] 27/1/2020 11:25

Brokers Jefferies have raised their target price to 1851p with a ‘buy’ recommendation.

[squintyflinty1] 24/1/2020 16:36

Definitely ,I meant to write !

[squintyflinty1] 24/1/2020 16:31

Starting to look oversold now......This share has had recommendations as one of the outperform shares in 2020.We shall see.I'm definetely taking a punt at around £14

[scooper72] 24/1/2020 16:19

I've cut my holding and taken profits as a result - but will be looking to buy back in if it gets down to 13 or starts to head straight back up and out of its current range.

[squintyflinty1] 24/1/2020 16:00

Taking another battering today as well. Has dropped a £1 per share in the last three days.Got a buy order in at £13.98.........lets see what happens.

[global nomad] 24/1/2020 07:29

deja vue

took a bit of a battering yesterday for some unknown reason....


looking to see how this responds today and if it bounces off the 50 day moving average, it seems to have dropped through the trend line

[squintyflinty1] 07/1/2020 11:48

Taking a bit of a battering today for some unknown reason