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G5 Entertainment AB (SE:G5EN)
:G5EN
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G5 Entertainment AB
(OTC:G5EN)
Rating:74Outperform
Price Target:―
G5 Entertainment AB (G5EN) vs. iShares MSCI Sweden ETF (EWD)
Market Cap
$893.78M
Dividend Yield7.27%
Average Volume (3M)27.29K
Price to Earnings (P/E)9.1
Beta (1Y)0.87
Revenue Growth-14.05%
EPS Growth-3.53%
CountrySE
Employees845
SectorCommunication Services
Sector Strength83
IndustryElectronic Gaming & Multimedia
Share Statistics
EPS (TTM)1.51
Shares Outstanding8,383,650
10 Day Avg. Volume21,838
30 Day Avg. Volume27,287
Financial Highlights & Ratios
PEG Ratio-0.40
Price to Book (P/B)3.52
Price to Sales (P/S)0.00
P/FCF Ratio13.63
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
G5 Entertainment AB Business Overview & Revenue Model
Company DescriptionG5 Entertainment AB (publ) develops and publishes free-to-play games for smartphones, tablets, and personal computers in Sweden. Its primary portfolio of games includes Hidden City, Jewels of Rome, Sherlock, Jewels of the Wild West, Mahjong Journey, The Secret Society, Jewels of Egypt, Homicide Squad, Sheriff of Mahjong, and Match Town Makeover. The company distributes games through Apple App Store, Microsoft Store, Google Play, Amazon Appstore, and Mac App Store, as well as its proprietary store.G5 Entertainment AB (publ) was founded in 2001 and is headquartered in Stockholm, Sweden.
How the Company Makes MoneyG5 Entertainment AB primarily generates revenue through its free-to-play business model, where games can be downloaded and played at no initial cost. The company monetizes its games through in-app purchases, where players can buy virtual goods, additional content, or power-ups to enhance their gaming experience. Additionally, G5 Entertainment earns revenue from in-game advertisements, which are displayed to players who opt to watch ads in exchange for in-game rewards. The company's success is bolstered by its ability to create engaging content that encourages long-term player retention and spending. G5 Entertainment also benefits from strategic partnerships with app stores and advertising networks, which help to increase the visibility and distribution of its games.
G5 Entertainment AB Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: -3.77%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
The earnings call presented mixed results with strong growth in G5 Store and improved gross margins, but significant revenue decline and decreased operating profit. The company maintained a strong cash position and implemented strategic initiatives, but faced challenges including legal expenses and FX impacts.Q1-2025 Updates
Positive Updates
Growth of G5 Store
G5 Store now contributes 21% of total net revenue, up from 13.5% last year, showing a 39% year-over-year growth in SEK and 35% in USD.
Record Gross Margin
The gross margin reached a record 69.8%, up from 68.1% last year, primarily driven by the growth of the G5 Store.
Strong Cash Position
The company has a record cash position of SEK295 million, up from SEK256 million last year, and remains debt-free.
Increased Revenue from Web Shop
The web shop now accounts for 3% of total net revenue from mobile platforms, allowing players to bypass high store fees.
User Acquisition Efficiency
User acquisition cost was 15% of revenue, down from 17% last year, contributing to improved profitability.
Negative Updates
Revenue Decline
Revenue in the quarter was SEK200 million, which was 12% lower than last year in Swedish krona and 13% lower in USD terms.
Operating Profit Decrease
Operating profit came in at SEK10.7 million compared to SEK39 million last year, with the EBIT margin down to 4.1% from last year's level.
Legal Expenses Impacting Profitability
A one-time legal expense of SEK1.3 million related to an M&A deal negatively affected profitability.
EPS Decline
Earnings per share for the quarter was SEK1.53, a decrease from SEK4.76 last year, primarily due to the impact of FX related to USD weakening.
Cash Flow Reduction
Total cash flow for the period was SEK33 million, down from SEK71 million last year.
Company Guidance
In the recent earnings call, G5 Entertainment's CEO, Vlad Suglobov, provided guidance reflecting both achievements and challenges. The company's revenue for the quarter was SEK200 million, marking a 12% decrease in Swedish krona and a 13% decline in USD terms compared to the previous year. Despite this, the G5 store demonstrated strong growth, contributing 21% to total net revenue, up from 13% last year, with an impressive 39% year-over-year growth in SEK and 35% in USD. The company's gross margin reached a record 69.8%, an increase from 68.1% the previous year, largely driven by the success of the G5 store. Additionally, the monthly average gross revenue per paying user hit a new record of $65.4, showing a 3% increase from the prior year. However, the operating profit for the quarter was SEK10.7 million, down from SEK39 million the previous year, primarily due to a SEK14.6 million impact from SEK to USD exchange rate fluctuations and a one-time legal expense of SEK1.3 million. The company remains optimistic about its strategic initiatives, including expanding the G5 store and incorporating third-party games, and aims to return to its user acquisition target range of 17% to 22% of revenue in the coming quarters.G5 Entertainment AB Financial Statement Overview
Summary
G5 Entertainment AB demonstrates strong financial health with robust profitability, a solid balance sheet, and strong cash flow generation. The company effectively manages its operations and finances, maintaining a stable financial position despite minor fluctuations in revenue. The lack of debt and strong equity positioning further enhance its financial stability and growth potential.Income Statement
G5 Entertainment AB shows strong profitability with a stable gross profit margin and robust net profit margin over the years. Despite a slight decline in revenue in the recent year, the company has maintained a solid EBIT and EBITDA margin, indicating efficient cost management and operational stability.78
Positive
Balance Sheet
The company has a strong balance sheet with no significant debt, leading to an excellent debt-to-equity ratio. High equity ratio and increasing stockholders' equity demonstrate financial stability and a solid capital structure. The return on equity (ROE) is also commendable, reflecting effective use of shareholders' funds.85
Very Positive
Cash Flow
G5 Entertainment AB exhibits a healthy cash flow position with consistent operating cash flow surpassing net income, indicating strong cash generation capability. The positive free cash flow and its growth over time further signify the company's financial health and ability to fund operations and investments without relying on external financing.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.10B | 1.13B | 1.32B | 1.40B | 1.32B | 1.36B |
| Gross Profit | 754.30M | 776.10M | 892.37M | 936.42M | 810.45M | 786.32M |
| EBITDA | 129.54M | 262.10M | 294.70M | 227.20M | 227.45M | 205.65M |
| Net Income | 93.44M | 118.97M | 127.57M | 66.95M | 198.21M | 167.27M |
Balance Sheet | ||||||
| Total Assets | 645.27M | 666.71M | 610.15M | 657.88M | 625.79M | 593.19M |
| Cash, Cash Equivalents and Short-Term Investments | 295.02M | 275.54M | 182.33M | 185.49M | 162.16M | 188.41M |
| Total Debt | 0.00 | 0.00 | 1.87M | 2.86M | 12.29M | 6.38M |
| Total Liabilities | 105.93M | 112.39M | 118.75M | 158.15M | 133.38M | 161.38M |
| Stockholders Equity | 539.34M | 554.32M | 491.40M | 499.73M | 492.41M | 431.81M |
Cash Flow | ||||||
| Free Cash Flow | 127.84M | 178.17M | 130.85M | 129.15M | 188.41M | 140.09M |
| Operating Cash Flow | 230.62M | 283.33M | 241.16M | 304.76M | 360.63M | 269.09M |
| Investing Cash Flow | -118.04M | -119.32M | -113.25M | -176.66M | -208.53M | -129.00M |
| Financing Cash Flow | -63.53M | -76.64M | -119.48M | -108.62M | -192.34M | -97.63M |
G5 Entertainment AB Technical Analysis
Negative
109.20
Price Trends
109.21
Negative
114.05
Negative
105.65
Positive
Market Momentum
-0.08
Positive
48.32
Neutral
62.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:G5EN, the sentiment is Negative. The current price of 109.2 is below the 20-day moving average (MA) of 110.65, below the 50-day MA of 109.21, and above the 200-day MA of 105.65, indicating a neutral trend. The MACD of -0.08 indicates Positive momentum. The RSI at 48.32 is Neutral, neither overbought nor oversold. The STOCH value of 62.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:G5EN.
G5 Entertainment AB Peers Comparison
Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $893.78M | 9.11 | 16.63% | 7.27% | -14.05% | -3.53% | |
55 Neutral | HK$64.39B | -1.86 | -1.90% | 7.19% | -4.17% | -13.99% | |
| $2.10B | 38.65 | 19.48% | 2.63% | ― | ― | ||
| $33.26M | ― | -28.05% | ― | ― | ― | ||
| $2.56B | 4.70 | 5.32% | ― | ― | ― | ||
| €30.22M | 39.33 | >-0.01% | 7.99% | ― | ― | ||
| €6.09M | ― | -60.20% | ― | ― | ― |
* Communication Services Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.