E Glu Mobile – Potential Ten Bagger

Glu Mobile (GLUU) is a mobile gaming company that is witnessing growth and popularity in the COVID-19 age. The company has impressive collaborations with Disney, Kim Kardashian, WWE, and many brands that get promoted within their games. Its revenues are derived from a variety of sources such as in-game ads and product promotions, CPI, subscriptions, etc.

GLUU generates positive cash flows and is expected to clock revenues of $500 million and an EBITDA of 15+% in 2020. It is an efficiently-managed and creative company with healthy cash flows and a strong cash balance. I am bullish on the stock for the long-term and consider it a potential 10-bagger – and here are the reasons why:

Strong Game Portfolio

Title

Genre

Performance

Notes

Design Home

Lifestyle

Bestseller

To be extended to desktop in 2020

Covet Fashion

Lifestyle

Bestseller

To be extended to desktop in 2020

Tap Sports Baseball

Sports

Massive potential

Recently launched. Has the potential to outperform

Diner Dash

Lifestyle

Above-average

--

Kim Kardashian Hollywood

Casual

Good performer

Contract extended with Kim for 3.5 years

Disney’s Sorcerer’s Arena

RPG

New launch

Global and massive potential

WWE Universe

 

 

Flop

Design Home is the current hot-performer and it is expected to rake in $200 million in 2020. Tap Sports Baseball is expected to garner $100 million, Covet Fashion about $78 million, Kim Kardashian Hollywood is at $40 million, Disney’s Sorcerer’s Arena (newly launched) at $55 million and Diner’s Dash at $30 million. WWE Universe is a flop.

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Disclosure: I have no position in the stocks discussed, and neither do I plan to buy/sell it in the next 72 hours. I researched and wrote this article. I am not being compensated for it (other ...

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Hanumantha Rao Turlapati 1 year ago Member's comment

superb Sir. The numbers look impressive.

Andrew Armstrong 1 year ago Member's comment

Great article.

Sunil Tinani 1 year ago Author's comment

Thanks, Andrew.

Adam Reynolds 1 year ago Member's comment

While I like gaming stocks, especially now when so many are stuck at home, $GLUU was relatively new to me. While I've heard of the company, I've never personally played any of their games and usually stick to companies that I'm personally a fan of. But #GluMobile certainly sounds like a company worth taking a closer look at.

Sunil Tinani 1 year ago Author's comment

Thanks, Adam. You also can check out PG. It may well turn into a mini-Amazon if the virus disruption prolongs