I see them as a high risk investment.
Their net tangible book value is close to zero. They lost money in the past fiscal year because their R+D and marketing costs was larger than their gross margin.
They forecast a 40% rise in sales for this fiscal year and plan to become profitable.
http://www.reuters.com/finance/stocks/UB...
http://finance.yahoo.com/q/ks?s=UBI.PA+K...
They have a market capitalization of 1.5 billion euros.
They have been on a 2 year fairly fast rise in price
http://finance.yahoo.com/echarts?s=UBI.P...
The price pulled back from a 52 week high. Earnings announce for Fiscal Q1 should be in mid-July.
Gross sales guidance is 310 million euros. If they meet the 1Q guidance and show a profit of at least 30 million euros it would appear they are on track.
If they miss target, expect a significant price drop.
If they meet target, the market price has already accounted for it.
If they beat target, they have a good potential. The question is how much of the increasing sales is getting lost to marketing costs and whether they keep pushing all of the money into their R+D.
You can watch them for another week or two and see if they continue to drop in price.
They closed Oct 15, 2013 at 11.09 and fell to 8.19 October 16. That was a game release date reschedule
http://finance.yahoo.com/news/ubisoft-sh...
With the large gross sales and margin if they have costs under control the stock could do very well.
Delay releases, spend too much in marketing and development, and the fact that the company is held up in price on air, it could drop again.
If you can afford a 25% loss or a wait for a recovery after a fall, then the potential of a rise could be worth a gamble.
With all the games coming out this fall and in the future that are developed and published by Ubisoft do you think it would be a smart choice to invest in Ubisoft?
