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Currency in EUR
Last close As at 24/03/2023
EUR1.61
▲ −0.04 (−2.42%)
Market capitalisation
EUR262m
MGI – Media and Games Invest is an advertising software platform with strong first-party games content. It mainly operates in North America and Europe. Organic growth is supplemented with acquisitions and the group has bought more than 35 companies and assets in the past six years.
The withdrawal of personal identifiers significantly alters the digital advertising landscape. MGI’s Verve Group was already one of 24 partners working in Google’s Privacy Sandbox, iterating approaches to privacy-first targeting. Most partners are web-focused, and Verve is valued for its premium mobile, in-app experience, including its supply-side platform and reputation for a high-quality advertising inventory. The new agreement was Google’s first in over two years.
Director, TMT
Paul Echt
FD
Remco Westerman
Executive Chairman
Forecast net debt (€m)
258.8
Forecast gearing ratio (%)
74
| % | 1M | 3M | 12M |
|---|---|---|---|
| Actual | (3.3) | (6.5) | (52.5) |
| Relative | (6.1) | (12.8) | (53.9) |
| 52 week high/low | €4.3/€1.4 |
MGI – Media and Games Invest (MGI) is increasingly focused on its vertically integrated multichannel advertising platform, retaining a core of games that serve to generate first-party data and provide an efficient sandpit for developing new services. FY22 results were at the top end of guidance (as revised upwards at Q322), despite the headwind of lower market advertising rates. This scenario has continued in Q123, and we have taken a cautionary approach to our revised FY23 forecasts, which will be reviewed when management issues guidance for the year at the Q1 update. Medium-term guidance remains for a revenue CAGR of 25–30%. The shares are valued well below peers and the level indicated by a discounted cash flow (DCF).
| Y/E Dec | Revenue (€m) | EBITDA (€m) | PBT (€m) | EPS (fd) (c) | P/E (x) | P/CF (x) |
|---|---|---|---|---|---|---|
| 2021A | 252.2 | 65.0 | 26.9 | 19.77 | 8.1 | 14.2 |
| 2022A | 324.4 | 84.8 | 30.3 | 12.07 | 13.3 | N/A |
| 2023E | 343.0 | 82.7 | 22.8 | 8.11 | 19.9 | N/A |
| 2024E | 388.5 | 94.5 | 32.7 | 11.96 | 13.5 | 104.7 |
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