UBISOFT Entertainment (UBSFY) AI Stock Analysis

• Market Cap: $1.69B
• Dividend Yield: N/A
• Average Volume (3M): 233.57K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.48
• Revenue Growth: 13.26%
• EPS Growth: 83.01%
• Country: US
• Employees: 20,665
• Sector: Communication Services
• Sector Strength: 85
• Industry: Interactive Multi-Media
• EPS (TTM): -0.10
• Shares Outstanding: 653,980,500
• 10 Day Avg. Volume: 381,734
• 30 Day Avg. Volume: 233,575
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.51
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Ubisoft's overall stock score reflects its ongoing recovery in financial performance, but significant challenges remain, particularly in cash flow and leverage. Technical indicators provide mixed signals, and valuation metrics are concerning due to negative earnings. The absence of detailed guidance from the earnings call adds to the uncertainty, emphasizing the need for cautious optimism.

UBISOFT Entertainment Business Overview & Revenue Model

Company Description

Ubisoft Entertainment (UBSFY) is a leading global video game publisher and developer, known for creating popular franchises such as Assassin's Creed, Far Cry, and Tom Clancy's series. The company operates in the interactive entertainment industry, focusing on the development, publishing, and distribution of video games across various platforms, including consoles, PCs, and mobile devices. With a diverse portfolio of games and a strong emphasis on innovation and storytelling, Ubisoft has established itself as a prominent player in the gaming world.

How the Company Makes Money

Ubisoft generates revenue primarily through the sales of video games, which include both physical copies and digital downloads. The company also earns money through in-game purchases, downloadable content (DLC), and expansions that enhance the gaming experience. Additionally, Ubisoft benefits from subscription services like Ubisoft+, which offers access to a vast library of games for a monthly fee. Licensing deals and partnerships with other companies in the technology and entertainment sectors further contribute to its earnings. Ubisoft's ability to continually release engaging content and leverage its franchises across various media platforms plays a significant role in its revenue generation.

UBISOFT Entertainment Financial Statement Overview

Summary

Ubisoft is in recovery with notable revenue growth and improved profitability margins. However, significant challenges exist with negative free cash flow and high leverage, which need addressing for sustained financial stability.

Income Statement

Ubisoft has shown a strong recovery in revenue with a 26.8% growth from 2023 to 2024. The gross profit margin remains robust at 91.1%, indicating efficient cost management, but the net profit margin improved only modestly to 6.9% after a significant loss in 2023. The EBIT margin rebounded to 13.6%, and the EBITDA margin is healthy at 48.0%, reflecting improved operational performance. Overall, the company is recovering well, but the past volatility in profitability is a concern.

Balance Sheet

The debt-to-equity ratio stands at 1.34, suggesting moderate leverage, which is manageable given the industry norms. Return on equity improved significantly to 8.4%, reflecting better profitability. The equity ratio of 36.6% indicates a balanced funding structure but shows a declining trend in equity proportion over the years. The company needs to maintain control over its leverage to ensure financial stability.

Cash Flow

Free cash flow remains negative, though the growth rate from 2023 to 2024 is not favorable, which is a concern for liquidity. The operating cash flow to net income ratio is 3.41, indicating strong cash generation compared to net income. However, the free cash flow to net income ratio is negative, highlighting ongoing cash utilization issues. Overall, cash flow management is crucial for future financial health.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
2.87B	2.30B	1.81B	2.13B	2.22B	1.59B
	Gross Profit
2.61B	2.10B	1.60B	1.86B	1.90B	1.34B
	EBIT
177.75M	313.60M	-585.80M	241.50M	289.40M	-59.50M
	EBITDA
269.00M	1.11B	719.30M	898.40M	915.00M	558.90M
	Net Income Common Stockholders
41.45M	157.80M	-494.20M	79.10M	103.10M	-125.62M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.21B	1.21B	1.49B	1.45B	1.87B	1.08B
	Total Assets
5.12B	5.12B	4.67B	4.96B	4.88B	3.60B
	Total Debt
2.51B	2.51B	2.46B	2.07B	2.09B	1.42B
	Net Debt
1.30B	1.30B	971.10M	617.70M	467.20M	343.63M
	Total Liabilities
3.24B	3.24B	3.19B	3.15B	3.22B	2.28B
	Stockholders Equity
1.88B	1.88B	1.48B	1.81B	1.66B	1.31B
Cash Flow		Free Cash Flow
750.20M	-465.60M	-425.80M	-282.20M	107.90M	-155.75M
	Operating Cash Flow
786.85M	537.60M	-354.20M	-191.60M	957.90M	600.36M
	Investing Cash Flow
-1.21B	-1.01B	-107.90M	-152.00M	-868.20M	-904.87M
	Financing Cash Flow
32.00M	204.70M	588.60M	139.90M	463.80M	431.54M

UBISOFT Entertainment Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2.56
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UBSFY, the sentiment is Neutral. The current price of 2.56 is above the 20-day moving average (MA) of 2.40, above the 50-day MA of 2.46, and below the 200-day MA of 3.29, indicating a neutral trend. The MACD of 0.05 indicates Negative momentum. The RSI at 58.12 is Neutral, neither overbought nor oversold. The STOCH value of 84.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for UBSFY.

UBISOFT Entertainment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EA	66 Neutral	$33.68B	32.88	14.15%	0.59%	-2.99%	-0.46%
TTWO	62 Neutral	$36.72B	―	-64.11%	―	1.00%	-148.89%
Sector *	59 Neutral	$30.54B	0.25	-13.23%	4.04%	2.36%	-49.53%
UBSFY	53 Neutral	$1.69B	―	8.41%	―	13.26%	83.01%