Keywords Studios Share Discussion Threads

[1670127] 30/10/2018 18:43

I think KWS have an opportunity to grow but the successful strategy employed to date is not going to work going forward. Once you have all the services and work with all the major clients then you already have the cross selling opportunities. Buying other companies, with the same clients, provides limited upside and there are risks that some clients will move work to keep a diversified supplier base or ask for reduced rates on current work if the acquired company has lower rates.

I've not analysed FDEV but after a cursory look it is interesting that the wife of the owner has bought 460,000 pounds of shares. At least they back themselves. I've not seen any director buys on KWS despite the near halving of the share price, probably says it all!!!

[mr euro] 30/10/2018 15:50

@ 1670127 FWIT I think KWS have a great future and will grow into a £1bn company, but they are someway of yet.

On the other hand FDEV I think are a pile of spanners. Can't see a bright future for them.

[1670127] 30/10/2018 13:45

@Mr Euro … you and I are in full agreement on this. My fair value estimation is between 300-400 million, with a growth premium of maybe 100 million based on peer P/E ratings (I have posted before). So even though this had dropped still think that the price should be 8 pounds per share (or thereabouts). I would buy at that level. The share price drop will make their acquisition strategy more difficult and I suspect those companies (and staff) that have shares will be looking to sell at the moment.

I know others have different views and I respect their opinions (and also reasoning), I have no position in the stock at the moment.

On the positive side, Sony is up on good sales (followed up by Nintendo) so there is some positive news in the sector.

[phowdo] 30/10/2018 09:39

It was another down day for the major videogaming stocks in the US yesterday
EA -5.2%
ATVI -5.2%
TTWO -7%

I remain short the sector.

[bamboo2] 30/10/2018 09:36

bulltrad, sorry, realise my comment was ambiguous.

I was implying that 1400 could be tested from below as resistance.
I probably wouldn't risk going long until 1320-1330, on a potential turn.
It is a shame that there are so many potential turns this week.

[rathean] 30/10/2018 09:29

Set my buy trigger at 1250, it will probably provide a bounce but not long term support imo dyor ofc.

[bulltradept] 30/10/2018 08:42

"No position, but will look for trades, as it looks like 1400 won't go quietly."

Not what Mr Market is saying currently..

[bamboo2] 29/10/2018 22:43

EOD close below key level.
Quite a few potential turns coming up, so could get volatile.
Near term confirmed H&S to approx. 1350.
No position, but will look for trades, as it looks like 1400 won't go quietly.

Wary of further lock-in expiries. Serasoft is the next, in December 2018. Their holding is subject to disposal controls, although I could not find detail.

[mr euro] 29/10/2018 08:41

The drop still has quite a bit more to go before I would be interested again. KWS are a solid firm with decent prospects, but as I have said on a few occasions, the rating is way way too high for me (still too high). They dont deserve this multiple or the same as software houses who take more risk.

I compare the sector to the bigger software houses like SAP and the difference in multiples between a pure software play (SAP) and the developers/integrators who provide the services and trade on a much smaller multiple.

KWS up to now have had their cake and eating it. You cant expect a sky high multiple (even with decent growth) and be a services provider who has a much smaller risk. The price would have to drop substantially before I would consider them value.

Everyone has their opinion, some will agree with me, others won't. Better places for my money than a services provider on an inflated rating.

[villarich] 26/10/2018 11:58

I hope everyone got their dividends today? I'm off out to buy a chocolate bar and a can of Coke with mine. Don't spend it all at once ;-)

[1670127] 26/10/2018 10:01

There are some interesting competitor rumours circulating. It appears that GlobalStep may have acquired testology. If true this probably moves them into that group of 2nd tier games services company along with testronics and pole to win. It is also interesting that Pole to win have set up a studio in Montreal. They have hired the test manager from Eidos and set up thier office across the road from them! Not sure these will have any impact on KWS but always interesting to keep an eye on the competition!

[1670127] 26/10/2018 09:57

I don't think it is unusual. KWS have been aggressive with thier acquisition strategy so there may be a higher risk, however the VMC acquisition, the biggest, was paid for through a stock placing so that risk is less than it could be.

[scooper72] 25/10/2018 21:59

Is this normally an issue for companies that make a lot of acquisitions?

[scooper72] 25/10/2018 21:57

Well let's hope they all get quickly snapped up if they start selling them, and well before we get back to 1400

[bamboo2] 25/10/2018 21:48

Player Research out of lock-in tomorrow. The share price was approx. 450 when they acquired their 65,280 shares.

[rathean] 25/10/2018 10:59

If it gets really bad I let my portfolio stew until the inevitable recovery, over time and on a technical and business case level I see value at this share price ... all depends on what your trading strategy is imo dyor ofc

[bamboo2] 25/10/2018 10:39

rich, agree about support level.

What worries me about the chart are two things,

1, The current bearish flag/pennant [apex of pennant and potential turn 25/10/2018]
2, A multi year H&S.

Bulkowski suggests flags and pennants mark the mid point in a price movement. This is what he describes as his half mast concept. On that basis, a downbreak tp is approx 1044.

The H&S neckline is approx 1400, and an eod close below this confirms a tp at 1040

1400 is support, and it really has to hold.

[villarich] 25/10/2018 09:36

The charts are saying it's a good place to get in for a run to 1600 odd - under normal market conditions! Let's hope it holds. I'm in at an average of 1410 but have a tight stop because I don't want to get caught out of this market correction gets REALLY bad.

[rathean] 25/10/2018 08:28

Added at 1400, also jumped into OPTI... ever the optimist.

[rathean] 24/10/2018 22:20

Oh no not opodio here as well. He spews mindless deramping without reason. The admin would do well to block him :)

[scooper72] 24/10/2018 18:16

Or should I be asking: based on what?

[scooper72] 24/10/2018 18:07

Warn what?

[opodio] 24/10/2018 08:56

Going to warn soon imho

[scooper72] 22/10/2018 14:26

Volume of trades is much lower than they tended to be last week.