I have been considering investing in CDPR this morning, so I dug some figures.
I already missed the AMD train a few years ago, because at that time I had nothing to invest
Talking extremely gross numbers :
CDPR market capitalization is roughly 10.10^9$ - ten billion dollars. 100$ a share, 100 million shares.
Its 2019 total revenue was 125m$, and the total financial assets were worth 350m$.
The market cap is 80 times bigger than the revenues of 2019.
We are talking about a company that invested heavily, quite exclusively, in one game during 5 years, and did not ship any major other game in the while. So such discrepancy has some ground.
At its 'hot spot' after Witcher3 release, in 2016-2017, CDPR had ~150m$ total annual revenue and 1bn$ capitalization.
so the market cap / revenue ratio was around 6.
Of course the assets counted in financial reports do not encompass the value of art, house-grown tech, skills of the teams, so it appears somewhat normal to me that the stock value is vastly de-correlated from the company's finances.
But for comparison, Ubisoft market cap is also near 10bn$, while its revenues in 2018 were 1.7bn$ and assets 2.8bn$ (according to wikipedia).
So, to hit back the cap/revenue ratio of 6, it would need to sell 20 million CP77 copies at 60$ in a year after release? oO
The Witcher3 sold 10 million copies in the first year.
Curious to know what you think.
I would tend to think CDPR capitalization may have grown a tad too fast, maybe staying a smaller studio for a while, in the eyes of the public and the other big players, would not have hurt them. Though, hard to contain investor euphoria(op as we know)... like 70% of shares is free float and 20% in the hands of CEOs.
EDIT : with correct numbers now!
I already missed the AMD train a few years ago, because at that time I had nothing to invest
Talking extremely gross numbers :
CDPR market capitalization is roughly 10.10^9$ - ten billion dollars. 100$ a share, 100 million shares.
Its 2019 total revenue was 125m$, and the total financial assets were worth 350m$.
The market cap is 80 times bigger than the revenues of 2019.
We are talking about a company that invested heavily, quite exclusively, in one game during 5 years, and did not ship any major other game in the while. So such discrepancy has some ground.
At its 'hot spot' after Witcher3 release, in 2016-2017, CDPR had ~150m$ total annual revenue and 1bn$ capitalization.
so the market cap / revenue ratio was around 6.
Of course the assets counted in financial reports do not encompass the value of art, house-grown tech, skills of the teams, so it appears somewhat normal to me that the stock value is vastly de-correlated from the company's finances.
But for comparison, Ubisoft market cap is also near 10bn$, while its revenues in 2018 were 1.7bn$ and assets 2.8bn$ (according to wikipedia).
So, to hit back the cap/revenue ratio of 6, it would need to sell 20 million CP77 copies at 60$ in a year after release? oO
The Witcher3 sold 10 million copies in the first year.
Curious to know what you think.
I would tend to think CDPR capitalization may have grown a tad too fast, maybe staying a smaller studio for a while, in the eyes of the public and the other big players, would not have hurt them. Though, hard to contain investor euphoria(op as we know)... like 70% of shares is free float and 20% in the hands of CEOs.
EDIT : with correct numbers now!
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