CyberAgent (4751) - Recent Sell-off Represents a Good Re-entry Point
We have been positive about CyberAgent (CA) since the company announced its venture into the video streaming industry and launched AbemaTV. Since our Nov 30th, 2016 report ‘CyberAgent – Backing its Bets by Doubling Up on AbemaTV Investment’, the shares rose 48% to hit a historical high of ¥4,100 on November 20th, 2017 – outperforming the Topix and the TPSERV Index by 23% and 16%, respectively. The stock has been on a downward trend since then, underperforming Topix and the sector by 9%.
Now, having reviewed the progress of each business with IR, we find we are confident about maintaining a favourable stance towards the company. In our view, each core segment should be able to outgrow the industry, enabling the company’s revenue to expand at double-digit rates over the FY18-FY20 period. OP growth should swing back to life from FY19 as contributions from AbemaTV move from negative to useful. We think the recent sell-off offers a good re-entry point for those who like the Abema TV story but were concerned about the short-term impact on earnings as it built momentum. Valuations are not expensive; while EV/OPe on our FY18 OP estimate is 14x, based on our FY19 OP forecast, it falls below 10x.
CyberAgent is an information technology company. Media segment is engaged in the operation of internet TV station "AbemaTV," free live streaming programs without subscription "FRESH!," blog service "Ameba," matching services "Tapple" and music streaming service "AWA." Game segment offers a variety of games for smartphones such as "GRANBLUE FANTASY." Internet Advertisement segment is engaged in the provision of internet advertising agency services. Investment Development is engaged in the corporate venture capital business, as well as the establishment and operation of investment fund. Others segment is engaged in the operation of smartphone media.
Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods.
PSA produces both company and sector reports. The focus of PSA’s research is to identify winners and losers as new technologies impact the top and bottom lines of corporations. Critical to our research is the clear explanation of how these new technologies work and how they impact companies and industries.
The founding partners have worked closely together for twenty years and the team has more than doubled in size since 2012.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.