Cherry: Q3 preview, we adjust our estimates upwards

Research Note

2017-11-01

10:59

Cherry will present their Q3 report on Wednesday the 8th of November. The sales level will rise significantly compared to last year, boosted by the ComeOn acquisition and organic development. We believe the more modest Q2 report will prove to be a minor hiccup and that the ComeOn! segment now will be more on-track. Game Development with Yggdrasil continues to deliver new games and clients at a non-stop rate. Our third-party data indicate a sharp increase in traffic for Game Lounge’s, Performance-based Marketing, main sites. We choose to adjust our estimates for the segment upwards prior the report. Today Game Lounge receives less attention than Yggdrasil and ComeOn; we believe this will change in the near-term due to the significant revenue ramp-up ahead. Our Base-case valuation is also marginally adjusted upwards to 79 (75) SEK per share.

KL

Kristoffer Lindström

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