It's trading at 12 month highs on events that may not pay off for 12 months. I don't short stocks but I also try not to overpay when I buy stocks. This one feels like it's out of control on anticipation of VR that's not going to roll out nearly quick enough to justify the current level of enthusiasm. Anticipation rarely lasts long enough to overcome reality. The reality is that the playstation does not ship until the end of the year and everything else won't be mainstream (due to price). Then again, it's a pretty in expensive bet if you think it will be. The loudest folks here are probably gamblers instead of investors. In the case of a gamble the house almost always wins...
The current price has nothing to do with value. The price of the stock less than 30 days ago was a value. The price now is 50% higher and that takes into account both the potential and the risks. The potential is from possible upside sales and licensing. The risks come from monthly loss and a huge pile of debt. The potential comes from the upcoming VR market. The risks come from the high price of entry and the potential for slow adoption rates due to the high cost. The potential comes from possible demand from great buzz. I believe the risks are very right now and the price holds plenty of potential for those willing to wait for it, but it wouldn't surprise me to see this drop significantly before it runs significantly. As you pointed out, the Sony playstation is coming but you neglected to mention that it won't be here until q4 and that's assuming we don't see more delays. This company needs to start making significant income asap and it's unclear that early VR adoption rates will be fast enough. Personally I hope they are, but it's too early to tell. Regardless, good luck with your investment.
I believe that the Oculus Rift is going to be PC based but PCs are now running apps so Gameloft might be able to develop games for that environment too
This is still trading less than 17% below where it was just two years ago; meanwhile they've grown their library, ported to more platforms and more languages, and increased their customer base. Somehow management let shareholders down for two years straight, the first sign of life being Vivendi's interest, so can can management say that this is bad for shareholders??? The addition of someone other than family, someone who has the best interest of 'all' shareholders (not just family), now that is a welcome addition!!! I know the family has built a great company but the share price drop prior to Vivendi's interest makes one wonder if the family wasn't using Gameloft as its own private piggy bank. How could their games be at the top of so many charts while the company generated losses? That doesn't seem very accountable to shareholders... If the family is worried and wants to correct things then make shareholders a tender offer. I bet most would accept 15 euros per share. Personally, I'd hold out for at least 20 euros per share. If King Entertainment is worth six billion nine hundred thousand dollars to Activision then Gameloft should be worth more than half that. Their current market cap is a joke which is why investors have been giving their shares away to Vivendi. Of course, savvy investors know that Gameloft is worth more than King; it's just a matter of monetizing their better franchises.
I believe that gives them more voting power than the entire management team and makes them the biggest single shareholder. They are also saying that they want a seat on the board and have not ruled out taking over GameLoft
Monday Nov 2nd, shares of Ambarella closed up around 5% after analysts at FBN Securities initiated coverage with an "outperform" rating and a $70-per-share price target... Here's hoping they are right!!!