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Gravity Co., Ltd. (GRVY)

NasdaqGM - NasdaqGM Real Time Price. Currency in USD
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54.71-0.77 (-1.39%)
At close: 04:00PM EDT
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  • P
    Philip
    Somebody help me out. Share price of $50ish, they have $30/share in cash, with absolutely no debt. They seem to have had a minor fall in revenue this last year, and the stock plummeted 75%. Having trouble understanding why
  • D
    Disa Sadi
    If I understood the latest release correctly ... servers crashed and are relaunching the game ...

    Sound okay to me
  • D
    Disa Sadi
    Yahoo is showing is showing a wrong eps number
  • O
    Oliver
    Financially Gravity is in a really strong position. Very strong balance sheet and a very impressive return on equity. I think what's keeping the stock down is the uncertainty about future earnings. They need to be able to keep producing games with high return. It seems as if the games they currently release have a good period for about a quarter and then their economical performance starts diving which puts them in a vulnerable position since they have to keep developing new games that people WANT to keep up with earnings. The gaming market is highly competitive so nothing is a guarantee especially when their games loose popularity so quickly. I'm not to say they cannot succeed. However it makes it very hard to come with a qualified guess on how their earnings will look like even in the near future.
    Neutral
  • K
    Kristoffer
    What to expect in 2021?

    Summary of 2020
    - Gravity posted strong results for Q3, with 70% top-line growth and more than 200% profit growth
    - The success of Next will be reflected in the coming quarters
    - Enterprise value (EV/EBIT) for Q3 was around 7 which is 3,7 times lower than similar stocks and the gaming-industry in general
    - Q4 will probably be a great quarter expected around $140-150m in revenue
    - Their latest release (RO2 spear of Odin) is performing really well with great reviews – the game is developed in house which means higher margins
    - Pipeline is huge in 2021 with several releases (both new markets and new games) – Thailand is the main market going into 2021
    - “Ragnarok – Eternal love”, “Ragnarok – Origin” and “Ragnarok – Next generation” is the majority of the revenue in 2020 - some of them are in-house developed other are in corporation with others where gravity gets royalties
    - Still no debt and HUGE cash on hand around $150m-$170m
    - Increasing self-developing which means higher margins
    - Still no analyst coverage
    - Smashed the game rankings (#1 in HK, Taiwan, and Macau)
    - Loyal fan base

    Release in china?
    Since gravity is a South Korean company they cannot just release any game in China without permission. This is a political decision and can be long drowned out. In 2020 there were only 3 Korean games approved to be submitted into china 2020. This is not much but together with Tencent I think there is a fair chance of getting approval in 2021. This will be VERY bullish for a new potential market of 1,4b people. But it’s not something I expect, why SEA, Latin America, and the Middle East is the main focus.

    Why this setback in December 2020?
    After seeing a huge run until 22 December a healthy pullback was needed. People taking profits into tax-season lowered down the stock price end of December but nothing is changed. The case is intact and I think we will see $250 again in January. I believe it’s a great buying opportunity for people who didn’t catch the train at first. We are not done yet.

    The future
    Personally, I think gravity can grow 5x to 10x (optimistic) its revenue within 2 years in regard to the pipeline and the markets they will enter in the next 1-2 years. This is without China taken into account. In the short term view I cannot see why gravity shouldn’t be 2x the share price of today after Q1 report release 2021. So I expect the SP to be $360 in summer 2021. Origin will be launched in Japan Q1 2021 and XNEXT in SEA Q1 2021.
  • k
    karen
    8-9% drop on 2x daily volume today is concerning. Not sure what is going on here, any insight is appreciated. I have been acquiring GRVY for the last several weeks and have cost averaged to $36. I have been thinking that this is going to pop on next earnings to $70+ but today's trading has me a bit concerned.
  • J
    Jens
    Ragnarok Next Gen. has generated more than 100 MUSD in the first 3.5 months of release. It's more than twice the expectations. Q4's gonna be exciting!!
  • J
    Jiyanask
    Total revenues were KRW 128,670 million (US$ 108,702 thousand), representing a 53.9% increase from the second quarter ended June 30, 2021 (?QoQ?) and a 2.4% decrease from the third quarter ended September 30, 2020 (?YoY?).

    Operating profit was KRW 40,242 million (US$ 33,997 thousand), representing a 110.1% increase QoQ and a 17.1% increase YoY.

    Profit before income tax expenses was KRW 41,435 million (US$ 35,005 thousand), representing a 113.7% increase QoQ and a 23.0% increase YoY.

    Net profit attributable to parent company was KRW 26,351 million (US$ 22,262 thousand), representing a 78.5% increase QoQ and a 4.2% increase YoY.
    Bullish
  • A
    Arty
    For anyone keep wondering why this stock price go down from $93 on May to $36 are due to couple reason:
    1). The launch of SEA, Global and Japan servers causing China, Taiwan and Korea servers population go down as they shift between server this actually reflect on their Q1 2019 financial report.
    2). Between April to May, there were string of issue where the game developer outrage the players especially players who spend lots of money into the game, most of this players actually start refund process on their googleplay/apple store. At one point their applepay gateway was block for a week by Apple due to this issue.
    3). The developer rushing on implementing new update within few months where it takes a while to catch up on the update/enjoy the patch content, this causing some old players found the game getting difficult if you not spending $500-$1000 monthly in game or play 24/7 to catch up. In original China version it takes like 6 months+ to release new patch but on SEA and Global the patch update interval is 3-4 months. Also every new patch there's a huge bug which cause maintenance every 3-4 days.
    4). There's a new server release on SEA called Midnight Party which launch on July recently, many players who invest lots of time and money to this game feel betrayed from the launching of this new server as they need to start fresh again if they wanted to join that server.
    p.s. I'm a player who have played their China, SEA and Global servers^^
  • V
    Van
    Considering opening a position. Strong balance sheet ($192M), no debt, consistently growing revenues, P/E of 6.64, P/S of 1.2. Looking at the latest quarterly release I can't see anything that justifies the drop in share price. The only thing I can think that might be weighing on this stock is the August 30, 2021 news that China China introduces new restrictions to limit the time under-18s can spend gaming online.

    Looking at their Q3 2021 Investor Presentation the user revenues by geography are as follows:

    18% (Taiwan/HK/Macau)
    23% (Korea/Japan/China)
    59% (Southeast Asia/Others)

    Do we know if these restrictions apply to Hong Kong and Macau or just mainland China? Anyone have any additional data that provides clarity on total China revenues rather than lumping them in with others (Korea/Japan/Taiwan)?
  • J
    John
    Gravity Co.: The earnings report Q3 2021 are released and the stock price is falling. For me, it looks like too much focus on the decline in total net revenue (T.N.R). T.N.R. are decreasing measured in relation to Sept. 2020 by approx. 2%, but it should be noted that the margin (profit before income tax) actually increases from approx. 25% to 32%. If the margin in Q3 2021 were unchanged at 25%, T.N.R could increase 20% compared with Sept. 2020, in fact, I do not think it is a bad earnings report at all. Gravity will expand into new markets 2022.
  • X
    Xratios
    Looks like a bargain to be honest. Tell me why it's not?
    1. Market cap less than $1B
    2. P/S of 1.88
    3. Ragnarok X: Next Generation Hits the Top of Apple App Store in Southeast Asia
  • N
    NewLonKong
    Gravity Business keeps rising and the share prices start to rise. The valuation is just too cheap. If the share prices double in a month or so, the PE is still less than 28 ! This is a high growth company ! Its latest quarterly investors presentation is here :

    http://www.gravity.co.kr/en/ir/pds/download.asp?curseq=140&curfileSeq=1
    Bullish
  • j
    justin
    "Gravity Co" owns the world's most successful online game IP.
    Ragnarok's mobile version, released three months ago in Taiwan, has been in the top spot since its release and is currently the second largest sales.. In March, it will be the bigger market and Ragnarok 's hometown in Korea, which will be released later in Japan and around the world.. If you are a smart investor, you might want to calculate the profit of the company.. Let's wait for 4Q results..
  • T
    The speculator
    This apple lawsuit with in-game purchases fee, should come gravity very good, litteraly 30% more revenue more from this, right?
    Bullish
  • A
    Anonymous
    Check balancesheet, huge cash pile, appr 15$ per share. Extremely undervalued company
  • T
    Thomas
    Let's see... Around 190 million USD in cash. No debt. Market cap around 600 million USD with P/E 9 and if subtracting cash from market cap around P/E 6... QoQ 110%, YoY 17% :)
    Bullish
  • D
    Disa Sadi
    So, my take on the numbers ... for what it's worth.

    The Revenue is higher in 2021 than in 2020 (just barely)
    Operating profit, up as well ( by around 10%) ...

    So, the business is making money ... the problem here is that one hit game pumps up the numbers for one quarter, then when the popularity of the game fades away that leads to disappointing results ...

    This difference in QoQ results leads to these changes ...

    Now, as someone else has noted the margins this quarter was horrendous. Someone mentioned a fair, or an expo leading to higher prices ... yes I hope so ...

    If we are lucky it is tied to a one-time event ... So, that theory makes the most sense right now.

    They are developing a blockchain-based game with NFT elements if I understood it correctly. So, this could prove to be beneficial.

    Regarding the Hong Kong subsidiary, for the life of me, I cant see this being a good idea to go to China arghhhh ... :(

    All in all, the business made more money in 2021 than in 2020 ... but not by as much as we hoped :(

    So far I am holding ... was planning to add more, but I will have to see specifics in their 20-F report in March.

    It wonderfully coincides with the FED stopping money printing ... so I expect a crash around then .. will see
  • J
    Jetman
    Nice movement yesterday and today on new game launch and earnings. I think this is just the start, as I see the stock moving up between $40-50 per share over the next week or two. Anyone else have thoughts?
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