Comments on: Cheap Stock Valuation Update GRVY

By: Michael

Michael — Tue, 16 Feb 2010 23:07:25 +0000

Thanks Jae!

By: Jae Jun

Jae Jun — Tue, 16 Feb 2010 22:18:17 +0000

Hi Michael,

We do in fact have a posting for GRVY in the forum
http://www.oldschoolvalue.com/forum/value-stock-idea/grvy-gravity-co-ltd/

As for entry price, I am never in the position to recommend entry points. All I can say is that I am currently up about 20% and I see the value of GRVY being at least $3.50 if the company improves even just slightly.

The current price is still below NCAV and GRVY has more cash than AR or receivables.

By: Michael

Michael — Tue, 16 Feb 2010 21:54:02 +0000

Hi Jae,

I just recently came across your blog and I have enjoyed going back and reading through your posts – excellent analysis and insights! With regard to GRVY, I was wondering if at the current price (1.90 to 2.00 range) you view that as an adequate entry point? I posted the comment here because I didn’t see a GRVY discussion on the forum.
Thanks Jae and kudos again on your blog!

By: Jae Jun

Jae Jun — Wed, 27 Jan 2010 06:53:58 +0000

Eric,

I was looking at the 20-F.

But Tom has a point. The company is worth more than what it is and comparing the stock price to the intrinsic value, it is very cheap.

By: Tom

Tom — Wed, 27 Jan 2010 00:33:36 +0000

Either way, this company is still valued between $3-6

By: Eric

Eric — Wed, 27 Jan 2010 00:15:52 +0000

Jae,
So I can learn from your mistake, where were you getting your second round of numbers for the update?

Eric

By: Jae Jun

Jae Jun — Tue, 26 Jan 2010 21:47:57 +0000

Tim, looks like you caught me with my pants down because you are darn right.
Seems like I was looking at the wrong reports all this time and the original numbers are correct.

Thanks. Does provide more breathing room as well.

By: Tim Eriksen

Tim Eriksen — Tue, 26 Jan 2010 18:13:23 +0000

Can you clarify why you made the changes? Gravity’s SEC filing shows $55.1 million of cash an equivalents and $7.3 million of short-term financial instruments as of 9/30/09. Source is 6-K filed 11/19/09.

By: Jae Jun

Jae Jun — Mon, 25 Jan 2010 08:52:42 +0000

@ Ankit,

I wish ADR’s submitted quarterly reports as well. Would help so much more because for all I know, we could be working with really old numbers.

@ SHM,
Make sure you check the numbers on the SEC and not just advfn.
Besides the NCAV I have is wrong. I didn’t bother changing that, only the NNWC.

@ Roberto,
Without Ragnarok 2, the company is increasing revenues in all its areas. Sales, royalties, mobile gaming is increasing. So the decision isn’t based on whether Ragnarok 2 succeeds or flops. That is just a catalyst to bring exposure. It would only be speculative, if I was betting that the intrinsic value is based purely on a successful launch of Rag 2.

@ Zehua,
Yea I agree to some degree but they’ve had 3 years to fix things. 3 years to change a project is a complete overhaul so I would expect the game to be on a whole new level.

@ tk,
Right. Upside far outweighs the downside.

By: tk

tk — Mon, 25 Jan 2010 04:08:04 +0000

if the launch flops so what? they have other games/revenue streams, and tons of cash sitting in the bank (net net value higher than market cap.) RO still makes money as well.

the big risk here is management.

lots of upside here, not much downside (especially from where i got in quite awhile back, thanks manual of ideas and their downside protection report.)