DB:ETA

Stock Analysis Report

Paradox Interactive

Executive Summary

Paradox Interactive AB (publ) develops and publishes games and brands for PC, mobile, and console platforms primarily in the United States, the United Kingdom, China, Germany, France, Russia, and Scandinavia.


Snowflake Analysis

Flawless balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has Paradox Interactive's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ETA has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-18.8%

ETA

-13.4%

DE Entertainment

-9.1%

DE Market


1 Year Return

-13.1%

ETA

18.9%

DE Entertainment

2.9%

DE Market

Return vs Industry: ETA underperformed the German Entertainment industry which returned 18.9% over the past year.

Return vs Market: ETA underperformed the German Market which returned 2.9% over the past year.


Shareholder returns

ETAIndustryMarket
7 Day-18.8%-13.4%-9.1%
30 Day-15.0%-11.9%-7.2%
90 Day-4.1%-7.8%-6.5%
1 Year-12.5%-13.1%20.5%18.9%6.1%2.9%
3 Year113.3%107.4%23.2%17.2%3.5%-5.6%
5 Yearn/a82.0%67.5%8.0%-6.8%

Price Volatility Vs. Market

How volatile is Paradox Interactive's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Paradox Interactive undervalued compared to its fair value and its price relative to the market?

29.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ETA (€12.99) is trading below our estimate of fair value (€17.98)

Significantly Below Fair Value: ETA is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ETA is poor value based on its PE Ratio (38.8x) compared to the Entertainment industry average (37.3x).

PE vs Market: ETA is poor value based on its PE Ratio (38.8x) compared to the German market (19.9x).


Price to Earnings Growth Ratio

PEG Ratio: ETA is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: ETA is overvalued based on its PB Ratio (12.9x) compared to the DE Entertainment industry average (1.3x).


Next Steps

Future Growth

How is Paradox Interactive forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

17.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ETA's forecast earnings growth (18.1% per year) is above the savings rate (-0.4%).

Earnings vs Market: ETA's earnings (18.1% per year) are forecast to grow faster than the German market (13.1% per year).

High Growth Earnings: ETA's earnings are forecast to grow, but not significantly.

Revenue vs Market: ETA's revenue (8.6% per year) is forecast to grow faster than the German market (5.1% per year).

High Growth Revenue: ETA's revenue (8.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ETA's Return on Equity is forecast to be high in 3 years time (28.3%)


Next Steps

Past Performance

How has Paradox Interactive performed over the past 5 years?

22.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ETA has high quality earnings.

Growing Profit Margin: ETA's current net profit margins (29%) are lower than last year (31.4%).


Past Earnings Growth Analysis

Earnings Trend: ETA's earnings have grown significantly by 22.2% per year over the past 5 years.

Accelerating Growth: ETA's earnings growth over the past year (5.7%) is below its 5-year average (22.2% per year).

Earnings vs Industry: ETA earnings growth over the past year (5.7%) underperformed the Entertainment industry 14.9%.


Return on Equity

High ROE: ETA's Return on Equity (33.2%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Paradox Interactive's financial position?


Financial Position Analysis

Short Term Liabilities: ETA's short term assets (SEK870.6M) exceed its short term liabilities (SEK473.7M).

Long Term Liabilities: ETA's short term assets (SEK870.6M) exceed its long term liabilities (SEK343.4M).


Debt to Equity History and Analysis

Debt Level: ETA is debt free.

Reducing Debt: ETA has not had any debt for past 5 years.

Debt Coverage: ETA has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: ETA has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: ETA has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if ETA's debt is covered by short term assets.


Next Steps

Dividend

What is Paradox Interactive's current dividend yield, its reliability and sustainability?

0.75%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Paradox Interactive before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company0.7%marketbottom25%1.5%markettop25%3.9%industryaverage1.3%forecastin3Years1.1%

Current dividend yield vs market & industry

Notable Dividend: ETA's dividend (0.73%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.52%).

High Dividend: ETA's dividend (0.73%) is low compared to the top 25% of dividend payers in the German market (3.92%).


Stability and Growth of Payments

Stable Dividend: ETA is not paying a notable dividend for the German market, therefore no need to check if payments are stable.

Growing Dividend: ETA is not paying a notable dividend for the German market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: ETA is not paying a notable dividend for the German market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ETA's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.3yrs

Average management tenure


CEO

Ebba Ljungerud (47yo)

1.5yrs

Tenure

kr2,504,000

Compensation

Ms. Ebba Ljungerud is Chief Executive Officer at Paradox Interactive AB (publ) since August 2018. Ms. Ljungerud was Chief Commercial Officer of Unibet Group plc from 2016 to June 30, 2018. Ms. Ljungerud ha ...


CEO Compensation Analysis

Compensation vs Market: Ebba's total compensation ($USD259.32K) is below average for companies of similar size in the German market ($USD1.76M).

Compensation vs Earnings: Ebba's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Fredrik Wester
Founder & Chairman1.5yrsno datano data
Ebba Ljungerud
Chief Executive Officer1.5yrskr2.50m0.013% SEK173.1k
Alexander Bricca
Chief Financial Officer1.9yrsno datano data
Mina Nakicenovic
Chief Technology Officer1.1yrsno datano data
Juliette Auverny-Bennetot
Senior Legal Counsel0yrsno datano data
Daniel Goldberg
Chief Marketing Officer1.1yrsno datano data
Marina Hedman
Chief Human Resources Officer1.1yrsno datano data
Johan Andersson
Executive Vice President of Creative Direction0yrsno datano data
Shams Jorjani
Chief Business Development Officer0yrsno data0.44% SEK6.0m
Mattias Lilja
Chief Production Officer5.1yrsno data0.0028% SEK38.7k

1.3yrs

Average Tenure

44yo

Average Age

Experienced Management: ETA's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Fredrik Wester
Founder & Chairman1.5yrsno datano data
Lars Klingstedt
Director3.9yrskr90.00kno data
Håkan Sjunnesson
Deputy Chairman0.8yrskr500.00kno data
Mathias Hermansson
Independent Director0.8yrsno datano data
Peter Ingman
Independent Director1.8yrskr250.00kno data
Josephine Salenstedt
Independent Director1.8yrskr250.00kno data

1.6yrs

Average Tenure

49yo

Average Age

Experienced Board: ETA's board of directors are not considered experienced ( 1.6 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ETA insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Paradox Interactive AB (publ)'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Paradox Interactive AB (publ)
  • Ticker: ETA
  • Exchange: DB
  • Founded: 1998
  • Industry: Interactive Home Entertainment
  • Sector: Media
  • Market Cap: kr14.520b
  • Listing Market Cap: kr1.364b
  • Shares outstanding: 105.60m
  • Website: https://www.paradoxinteractive.com

Number of Employees


Location

  • Paradox Interactive AB (publ)
  • Västgötagatan 5, 6 vån
  • Stockholm
  • Stockholm County
  • 118 27
  • Sweden

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PDXOM (OMX Nordic Exchange Stockholm)YesOrdinary SharesSESEKMay 2016
ETADB (Deutsche Boerse AG)YesOrdinary SharesDEEURMay 2016
0GDULSE (London Stock Exchange)YesOrdinary SharesGBSEKMay 2016
PRXX.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMay 2016

Biography

Paradox Interactive AB (publ) develops and publishes games and brands for PC, mobile, and console platforms primarily in the United States, the United Kingdom, China, Germany, France, Russia, and Scandinavia. The company publishes own titles and titles developed by independent studios, as well as music and books. Its game portfolio comprises approximately 100 titles and brands, including Stellaris, Europa Universalis, Hearts of Iron, Crusader Kings, Cities: Skylines, Prison Architect, Magicka, Age of Wonders, and the World of Darkness. The company was founded in 1998 and is headquartered in Stockholm, Sweden. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/28 22:55
End of Day Share Price2020/02/28 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.