- GRVY has an excellent business with its IP. However, I consider its dependence on one single franchise to be very risky for investors.
- Yet, it's undeniable that a gaming niche loves GRVY's "Ragnarok" franchise. Even though this can cap the company's growth, it also gives it a business moat of sorts.
- Unfortunately, from a numbers perspective, I think its valuation is excessive and doesn't reflect its inherent risks.
- In my view, the company's stock should be worth roughly $92 per share. This implies a 19.9% potential downside from current levels.
- Consequently, I think it's better to pass up on GRVY for now. And even after a pullback, GRVY shouldn't be a significant part of your portfolio.
For further details see:
Gravity: Niche IP, Speculative, And Expensive