2013-10-03 09:10:21 - Joseph Grinkorn: “King had learned from the mistakes of Zynga and Facebook. The company has an income of approximately $600 Million a year and is predicted to go public on a relatively low value of $5 Billion.”
Earlier this week, gaming giant King has filed for a US IPO.
and why not when you have the top Facebook application, with over 75 million active users a day you must be doing something right.
So, why are analysts and critics rushing to compare King to Zynga and have all the concerns and worries of a failing stock?
Joseph Grinkorn, a Social Media stock investments expert says: "I think KING is primed for an IPO and it's not because of the bull market we are in, or following the path of twitter. it's because the numbers users and multiples just make sense."
Let's look at the statistics:
- King has the top Facebook app with 40 million daily users.
- it has
225 million monthly active users worldwide.
- It offers 150 games in 14 languages on its site and mobile.
- The top 3 out of the 4 games worldwide are all king products: 1st is Candy Crush, 2nd is Pet Rescue and the 4th is Farm Heroes.
- It is estimated that kings annual income is $600 million a year.
- And the most important thing is that KING has conquered the mobile gaming market.
So why would King not turn out to be like Zynga? its simple:
Zynga had no mobile presence two years ago during its IPO, and when mobile came full swing to markets, Zynga is still today figuring it out.
A big problem for Zynga was that over 90% of its gaming traffic was through Facebook, which means much lower profit margins. with King that is not the case, and more equally split.
Zynga today has only 10 million active users and its top games Farmville and Texas Hold'em are ranked 12 and 14.
Zynga's IPO was at approx. $9 billion. King's will be almost half of that at approx. $5 billion and with income at the $600 Million mark it is a cheap multiple.
Zynga's main game Farmville was its income leader, in kings case, they have 3 hits all generating heavy income.
So what do I see as the future for King and its IPO? Lots of candy…HUGE SUCCESS
I can see the first day of trading spiking the stock to a rise of over 30% and for King to be the stand out leader in gaming going forward.
Although I do have hopes for a Zynga comeback, King for now has the thrown. I cannot say there has ever been a game that has reached the audience of teenagers, seniors and people of all ages, until now. Candy Crush on its own has simply become an ADDICTION and will help leading king to a royal IPO. with all the royal treasures and candies.