Enad Global 7 (OM:EG7) - Share price, News & Analysis

Q: What is the Fair Price of EG7 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

EG7 (SEK17.15) is trading below our estimate of [[fair value]] (SEK56.33)

EG7 fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	3/6
Past Performance	2/6
Financial Health	4/6
Dividends	0/6

EG7 Stock Overview

Enad Global 7 AB (publ) develops, markets, publishes, and distributes PC, console, and mobile games in Sweden, rest of Europe, North America, South America, Asia, Africa, and Oceania.

Rewards

Trading at 69.6% below our estimate of its fair value

Earnings are forecast to grow 20.58% per year

Became profitable this year

Risk Analysis

Highly volatile share price over the past 3 months

Large one-off items impacting financial results

Enad Global 7 Competitors

G5 Entertainment

OM:G5EN

kr1.9b

Flexion Mobile

OM:FLEXM

kr836.5m

MAG Interactive

OM:MAGI

kr561.7m

Stillfront Group

OM:SF

kr13.8b

Price History & Performance

Summary of all time highs, changes and price drops for Enad Global 7
Historical stock prices
Current Share Price	kr17.15
52 Week High	kr69.10
52 Week Low	kr12.64
Beta	0.36
1 Month Change	3.31%
3 Month Change	10.36%
1 Year Change	-74.05%
3 Year Change	22.50%
5 Year Change	n/a
Change since IPO	63.33%

Shareholder Returns

	EG7	SE Entertainment	SE Market
7D	4.6%	-6.3%	0.7%
1Y	-74.1%	-19.9%	-22.1%

Return vs Industry: EG7 underperformed the Swedish Entertainment industry which returned -23.2% over the past year.

Return vs Market: EG7 underperformed the Swedish Market which returned -23.9% over the past year.

Price Volatility

Is EG7's price volatile compared to industry and market?
EG7 volatility
EG7 Average Weekly Movement	13.0%
Entertainment Industry Average Movement	8.4%
Market Average Movement	7.2%
10% most volatile stocks in SE Market	12.7%
10% least volatile stocks in SE Market	4.6%

Stable Share Price: EG7 is more volatile than 90% of Swedish stocks over the past 3 months, typically moving +/- 13% a week.

Volatility Over Time: EG7's weekly volatility (13%) has been stable over the past year, but is still higher than 75% of Swedish stocks.

About the Company

Founded	Employees	CEO	Website
2013	880	Ji Ham	https://www.enadglobal7.com

Enad Global 7 AB (publ) develops, markets, publishes, and distributes PC, console, and mobile games in Sweden, rest of Europe, North America, South America, Asia, Africa, and Oceania. The company also provides consulting services for development strategies and marketing of games; and marketing services. In addition, it released approximately 1,500 titles under the Call of Duty, Destiny, Dark Souls, Elden Ring, and Rage brands.

Enad Global 7 Fundamentals Summary

How do Enad Global 7's earnings and revenue compare to its market cap?
EG7 fundamental statistics
Market Cap	kr1.52b
Earnings (TTM)	kr81.10m
Revenue (TTM)	kr1.97b

18.7x

P/E Ratio

0.8x

P/S Ratio

Is EG7 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
EG7 income statement (TTM)
Revenue	kr1.97b
Cost of Revenue	kr701.50m
Gross Profit	kr1.27b
Other Expenses	kr1.19b
Earnings	kr81.10m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Aug 23, 2022

Earnings per share (EPS)	0.92
Gross Margin	64.47%
Net Profit Margin	4.11%
Debt/Equity Ratio	8.6%

How did EG7 perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is EG7 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for EG7?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for EG7. This is calculated by dividing EG7's market cap by their current preferred multiple.
What is EG7's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	kr1.52b

EG7 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.7x
Enterprise Value/EBITDA	20.6x
PEG Ratio	0.9x

Price to Earnings Ratio vs Peers

How does EG7's PE Ratio compare to its peers?

EG7 PE Ratio vs Peers

The above table shows the PE ratio for EG7 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	27.5x
G5EN G5 Entertainment	9.8x	24.8%	kr1.9b
FLEXM Flexion Mobile	56.4x	56.3%	kr836.5m
MAGI MAG Interactive	19.1x	6.4%	kr561.7m
SF Stillfront Group	24.7x	25.3%	kr13.8b
EG7 Enad Global 7	18.7x	20.6%	kr1.5b

Price-To-Earnings vs Peers: EG7 is good value based on its Price-To-Earnings Ratio (18.7x) compared to the peer average (27.5x).

Price to Earnings Ratio vs Industry

How does EG7's PE Ratio compare vs other companies in the European Entertainment Industry?

Price-To-Earnings vs Industry: EG7 is expensive based on its Price-To-Earnings Ratio (18.7x) compared to the Swedish Entertainment industry average (18.4x)

Price to Earnings Ratio vs Fair Ratio

What is EG7's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

EG7 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	18.7x
Fair PE Ratio	41.7x

Price-To-Earnings vs Fair Ratio: EG7 is good value based on its Price-To-Earnings Ratio (18.7x) compared to the estimated Fair Price-To-Earnings Ratio (41.7x).

Share Price vs Fair Value

What is the Fair Price of EG7 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: EG7 (SEK17.15) is trading below our estimate of fair value (SEK56.33)

Significantly Below Fair Value: EG7 is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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Future Growth

How is Enad Global 7 forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

20.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: EG7's forecast earnings growth (20.6% per year) is above the savings rate (0.4%).

Earnings vs Market: EG7's earnings (20.6% per year) are forecast to grow faster than the Swedish market (16.3% per year).

High Growth Earnings: EG7's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: EG7's revenue (0.08% per year) is forecast to grow slower than the Swedish market (10.9% per year).

High Growth Revenue: EG7's revenue (0.08% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: EG7's Return on Equity is forecast to be low in 3 years time (4.3%).

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Past Performance

How has Enad Global 7 performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

3.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: EG7 has a large one-off gain of SEK348.6M impacting its March 31 2022 financial results.

Growing Profit Margin: EG7 became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: EG7 has become profitable over the past 5 years, growing earnings by 3.2% per year.

Accelerating Growth: EG7 has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: EG7 has become profitable in the last year, making it difficult to compare its past year earnings growth to the Entertainment industry (12%).

Return on Equity

High ROE: EG7's Return on Equity (1.7%) is considered low.

Discover strong past performing companies

Financial Health

How is Enad Global 7's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: EG7's short term assets (SEK800.9M) exceed its short term liabilities (SEK640.7M).

Long Term Liabilities: EG7's short term assets (SEK800.9M) exceed its long term liabilities (SEK706.7M).

Debt to Equity History and Analysis

Debt Level: EG7 has more cash than its total debt.

Reducing Debt: Insufficient data to determine if EG7's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: EG7's debt is well covered by operating cash flow (44.3%).

Interest Coverage: Insufficient data to determine if EG7's interest payments on its debt are well covered by EBIT.

Balance Sheet

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Dividend

What is Enad Global 7 current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate EG7's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate EG7's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if EG7's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if EG7's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: EG7 is not paying a notable dividend for the Swedish market.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as EG7 has not reported any payouts.

Discover strong dividend paying companies

Management

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

2.7yrs

Average board tenure

CEO

Ji Ham

Tenure

kr3,000,000

Compensation

Mr. Ji Ham has been Acting Chief Executive Officer at Enad Global 7 AB (publ) since August 26, 2021. Mr. Ham has extensive background in both gaming and finance and has for the last six years been the CEO...

CEO Compensation Analysis

Compensation vs Market: Ji's total compensation ($USD299.13K) is below average for companies of similar size in the Swedish market ($USD435.89K).

Compensation vs Earnings: Insufficient data to compare Ji's compensation with company performance.

Board Members

Experienced Board: EG7's board of directors are not considered experienced ( 2.7 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: EG7 insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/08/10 00:00
End of Day Share Price	2022/08/10 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31