KYYWY - Keywords Studios: A Potential Buying Opportunity Amid Valuation Divergence

2024-05-21 10:58:12 ET

Summary

• Keywords Studios is a creative services provider to the gaming industry, offering technical and creative services to the video game and digital media industries.
• The company operates in three main divisions: Create, Globalize, and Engage, focusing on game development, QA testing, localization, marketing, and player engagement.
• Last year's Hollywood strike slowed down activities in some of the company's divisions, influencing the top line. However, the company showed resilience by reporting 13% YoY revenue growth for FY23.
• Despite today's price spike, the stock had experienced a price decline and valuation divergence over time, while the company has maintained revenue growth and strong margins.

Keywords Studios ( KYYWF ) is a creative services provider to the gaming industry, being in the business of offering technical and creative services (which include art creation, game development, QA testing, localization, translation, marketing, player support, and audio services) to the video game and digital media industries for over two decades. Keywords Studios operates an outsourced business model with a network of over 70 game studios around the world . The company operates in three main divisions: Create, Globalize, and Engage. The Create division focuses on game development, art services, and audio development. The Globalize segment offers QA testing and localization services. The Engage segment focuses on marketing and player engagement....

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