The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
So quite here so I just going to share something that might be useful :)
For those who are invested or considering investing in the 'video game tech' tracking this EFT 'GAMR' to you Watch list
ref https://seekingalpha.com/symbol/GAMR/overview
I will also add this report on October sales (sorry US related) https://seekingalpha.com/news/3411488-key-october-releases-pace-videogame-sales-record plus it's Black Friday today (good for hardware/game sales)
Hi Workover
Interesting you mentioned 'the market' ... I notice that the US/Japanese gaming companies have recently been reduced to trading around their 200MA in their five year charts ...maybe the 'global' gaming sector sell off may have finally settled down ...and maybe 'globally' investors might be buying back in this sector (or not). I only mention this because Keywords is a global operation
Personally I got taken out today (50% on what I was holding) on a stop loss set at just under the 1100 level, maybe a good thing only time will tell
Good luck all
Hi MB60 I learned a while back not to fight against the market! Specially when in profit ! This share seemed unbeatable a while back and I was silly enough to belive it couldn’t fall below the 1400 placement price so I removed my trailing stop loss! The facts are that this is a well run company with good prospects however it does have a high market cap with a huge PE ratio . The shorts are increasing and I believe we also have a large institutional seller. Remember some of them bought in at 200-300p! Good luck all
Hi workover, looks like you made a good choice ...I see Polar Capital increased their short position on the 9th (possibly kick starting the current down trend)
with four possible shorters on board it might be a case of who will close first, ref.... https://shorttracker.co.uk/company/GB00BBQ38507/
I do see that yesterday the SP did hit a previous support level (1092) but i do see a possible lower support level (1046) that might be reached today... if the SP can keep above1092 I will in return will remove my finger off the sell button
Since it appears that so many 'game' related companies have taken a hit recently... maybe (that's a big maybe) things might be looking up
example, Ubisoft's SP seems to be now making an effort not to go lower https://www.google.com/search?sa=X&tbm=fin&q=EPA:+UBI&stick=H4sIAAAAAAAAAONgecRoxi3w8sc9YSndSWtOXmNU5-IKzsgvd80rySypFJLkYoOy-KV4ubj10_UNU8pMM3KLinkA-niO9jsAAAA&ved=0ahUKEwjbvKXoqNHeAhWnyIUKHWTRBQcQ3N8BCEswAg&biw=1288&bih=679#scso=_zr3qW97yDI3uaZ6IrLAO2:0
Sorry the above was a little off beat but to quote from the last report on the18th September... (yes I know old news)
Outlook
· Selectively reviewing a strong acquisition pipeline
· Trading in the second half has been good and we expect to meet market expectations for the full year before the positive impact of any additional acquisitions
After being here for a few years I’ve decided to sell 75% of my holding ! The drop has been relentless on both this and ACSO over the past few weeks and shows no signs of stopping! I wish I sold at 1800p but better late than never ! I’ll completely liquidate at £10... Good luck to anyone who is still fully invested
The current drop could well be related to US gaming companies taking a big hit last Friday
examples
EA https://seekingalpha.com/symbol/EA
Blizzard https://seekingalpha.com/symbol/ATVI?ifp=0
Looks like today wasn’t the best time to buy!fuck I can never catch the bottom,Newbery here,anyone know the reason for the decline,seems to be at odd with what the brokers think?have I missed something in my due diligence?
Berenberg today reiterated their Buy and 2100p target:
Http://investing.thisismoney.co.uk/broker-views/
The valuation here must be getting interesting for newbies.
Given the available cash and facilities, Edison have estimated that using "reasonable assumptions" on organic growth and acquisition multiples, KWS could exit FY19 at the 85c EPS level, i.e around 75p EPS, That's a forward P/E of only 19 at 1440p - not very stretching at all.
The 6.5% in above post refers to trades not actual shares. It becomes 3.25% of issued shares only if each deal is a discrete buy or sell.
FWIW by my reckoning
'
Friday was the maximum daily trading volume recorded this year by a large margin at 1,182,413
'
My calc gives daily Median at 188,193 and top quartile starts at 281,503
We haven’t seen volumes of this order since the placing on 25th October 2017.
Shares in issue are 63.78 million
'
All this adds to past six days trading where over 4.2 million shares have been traded or 6.5% of issued shares. The share price reaction is that it is down from 1946 to 1496 or a 22% drop
Broader market impact from US/China it would seem.
Anyone know what has caused the fall in the share price over the last few days?
Hopefully today hitting around £14.00 (same as support levels at the start of the ) 'might be' the end of the fall
Nice Buy rec today from a successful fund manager:
Https://www.ii.co.uk/analysis-commentary/buy-hold-sell-three-small-caps-own-or-ditch-ii506886/
"4th October 2018 08:58
This smaller companies trust has thrashed the market over the past year. Tom Bailey tells us which shares fund manager Georgina Brittain has been trading recently.
Buy
Keywords Studios (KWS: LON)
"Keywords Studios is basically a service provider for the video games industry," says Brittain. It provides technical services to the video games industry such as audio, adaption for different regions and translation, among other back-office tasks. "It's the "picks and shovels" behind the glamour of games, a market worth about $140 billion globally, she explains.
Within this market, Keywords Studios stands out. Many of its competitors provide just one part of the many back-office functions outsourced by video game creators. Keywords Studios, by contrast, is a consolidator, providing a wide range of services to video game companies. Listed on the Alternative Investment Market, the company's customers include Nintendo, Tencent and Electronic Arts.
Keywords Studios was purchased at £8.20 in May 2017. Its price at the end of August 2018 was around £20 per share."
Great spot skittish, good news for KWS.
Nice £965,000 buy at 1930p just now........
On twitter-
Studio Gobo
"@StudioGobo
24h24 hours ago
We're sorry to hear the bad news guys 😔 For any Telltale folk that have been affected by this, we're currently scaling up for two huge projects and would love to hear from you"
Great interview with Andrew Day - confirming that KWS still have more than €100m to spend on acquisitions:
Https://www.independent.ie/business/irish/game-firm-keywords-studios-has-100m-to-fuel-acquisition-spree-37330224.html
"Game firm Keywords Studios has €100m to fuel acquisition spree
Irish company also looking at increasing its office space in Dublin
September 19 2018 2:30 AM
Irish video-game company Keywords Studios has more than €100m available to spend on acquisitions, according to the group's chief executive Andrew Day.
Speaking to the Irish Independent he said that analysts assume that the group will spend between €40m and €60m a year on acquisitions.
"This is a reasonable assumption unless we buy something bigger, and yes we have the firepower for this, we have a €105m bank facility," Mr Day said.
So far this year the group has made eight acquisitions, and looking forward it said that it was "selectively reviewing a strong acquisition pipeline".
Deals are being bolted on so that Keywords can offer the same mix of technology services to the gaming sector in all of the markets where it operates.
"The [acquisition] programme will be continuing into the future, due to the fragmented market place," Andrew Day said
"This makes sense as a lot of our clients are global, we are operating in 20 odd countries, we have done a lot of geographic expansion but we put don't provide full suite of services in all those countries, so there are always more opportunities [for acquisitions]," Mr Day said....
....Looking forward, the group said that technology and internet bandwidth improvements could enable streaming of video games for the first time which it believes will drive record demand for gaming content....
....Behind that acquisition spree is Keywords' view that it can tap into a reorientation of the games market around interactive streaming of content.
That mirrors the change companies like Netflix have experienced in the video market."
And another interview here:
Https://www.thetimes.co.uk/article/keywords-acquisitions-boost-the-bottom-line-tqx672qsj
"Mr Day said: “We have a pipeline of acquisition opportunities which we expect to develop. We will be investing in our audio business and will have a look at art production next year.”
Many of the recent purchases have been businesses based in the UK. Mr Day said this is because the UK is a market with a large talent pool, and is also relatively cheap compared with the US."
A good mention for Peel Hunt's Buy rec on Citywire:
Http://citywire.co.uk/money/the-expert-view-ocado-thomas-cook-and-restore/a1156335?ref=citywire-money-latest-news-list#i=5
"Keyword Studios poised to corner market, says Peel Hunt
Keywords Studios (KWS), provider of technical services to the video games industry, is positioned to corner the market, says Peel Hunt.
Analyst Ashu Sony retained his ‘add’ recommendation and target price of £21 on the stock after a ‘strong first half’. The shares were trading at £19.18.
‘We believe it is attractively positioned to corner the market through its established market-leading position and blue chip client base, significant cross-selling opportunity, and an unmatched record of value-accretive mergers and acquisitions,’ he said."
Citigroup today say Buy and massively increase their target price to 2150p (from 1400p):
Http://investing.thisismoney.co.uk/broker-views/
Comments here from both Berenberg and Peel Hunt today - good to see Berenberg's confidence that KWS will "at least" meet forecasts:
"Keywords Studios looks confident ahead of a busy second half, during which the provider of technical services to the videogame industry should hit Berenberg's full-year forecasts, the investment bank says. As the company grows its portfolio with the acquisition of The TrailerFarm, it has also invested in expanding organic capacity, Berenberg says. "This demand-induced increase in capacity going into one of the most congested game-release schedules in recent years--coupled with six months' contribution from 1H acquisitions and a strengthening U.S. dollar--gives us confidence that Keywords will at least meet our full-year forecasts," Berenberg says"
"Keywords Studios is well-positioned to corner the market in outsourced technical services to the videogames industry, Peel Hunt says, after the company posted soaring first-half pretax profit on an acquisitions-fueled revenue boost. Keywords already has a leading position in that sector, with an 8% market share, and disposes of a blue-chip client base, the brokerage says. On top of that, Keywords has an unmatched record of value-accretive acquisitions, which gives it significant cross-selling opportunity, says Peel Hunt."
i.e 30% upside from here:
http://investing.thisismoney.co.uk/broker-views/
The number of shares issued is not that great and the new management will be looking forward to increased dividend when the acquisition spree subsides.
Yes , all stars aligned