Stillfront Group: Revaluation is in order

Research Update

2018-03-19

07:30

Stillfront showed strong numbers during Q4 but, of course, the most exciting thing was the healthy development of Goodgame Studios which will be consolidated from Q1'18. Stillfront expects that Goodgame will produce net sales of EUR 120-130m with and EBIT of EUR 25-30m during 2018. We view the guidance as highly plausible. Today Stillfront trades at a discount of about 45% to peers based on EV/EBIT multiples. Our new Base-case of 258 (248) SEK per share implies an EV/EBIT18E of 19x, which is still a little lower than other gaming companies. We find no apparent reason for a discount as large as the one we see today.

KL

TO

Kristoffer Lindström

Tomas Otterbeck

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