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Extensive research

Video game company for the long run

Remedy Entertainment
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Remedy has progressed as planned in all its strategic objectives since the IPO a year ago. The gaming projects have progressed as scheduled, and Remedy has advanced successfully to the simultaneous development of two large scale gaming projects. The company has a good relationship with two strong publishers, with whom we believe the co-operation has gone well thus far. Although the progress of the strategy does not yet reflect in the company’s numbers due to the developmental stage of the projects, the development going as planned has substantially decreased Remedy’s risk level when compared to last year. We expect the multi- project model strategy transition currently underway to start to bear fruit next year. We reiterate our buy recommendation and increase our target price to 8.50 EUR (previously 7.5 EUR).

Remedy Entertainment

7.3EUR01.06.2018, 18.00
8.50EURTarget price
Buy
Recommendation updated:03.06.2018

Remedy Entertainment is a game developer. The business is primarily focused on the development of action games, with a particular focus on 3D technology. Examples of games developed by the company include several different versions of Alan Wake, Max Payne, and Control. Remedy also develops its own game engine and utility technology that powers many of the games. The company was founded in 1995 and has its headquarters in Espoo.

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Key Estimate Figures03.06.2018

201718e19e
Revenue17.220.931.2
growth-%4.6 %21.5 %49.6 %
EBIT (adj.)2.6-0.07.7
EBIT-% (adj.)15.0 %-0.2 %24.7 %
EPS (adj.)0.16-0.010.50
Dividend0.000.000.20
Dividend %1.2 %
P/E (adj.)40.3-34.6
EV/EBITDA25.81,150.723.0
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