Business & Investment

MIDAS SHARE TIPS: Frontier Developments Rapidly Increase Profit

MIDAS SHARE TIPS: Profit surges at Frontier Developments, a video game company with an army of enthusiastic fans

Frontier Developments is another very successful video game company. The group entered the stock market in 2013. That’s because we’ve grown exponentially by moving from developing titles for third parties to publishing our own games.

Be careful when publishing. If the game fails, the loss can be catastrophic, but Frontier has proved its spirit and millions of players around the world in games such as Jurassic World Evolution, Planet Zoo and Elite Dangerous. Is fascinated.

Like sumo, Frontier is run by its founder, David Braven. Braven, now 57, created his first game 39 years ago while studying the natural sciences at the University of Cambridge.

Popularity: Frontier has captivated millions of players around the world with games such as Jurassic World Evolution, Planet Zoo and Elite Dangerous.

Frontier is still based in Cambridge, Braven remains enthusiastic about the industry to this day, and games are a way to be creative, connect people around the world, and bring solid profits to shareholders. believe.

One of those shareholders is Tencent. The Chinese group holds an 8.6% stake in Frontier and holds a seat on the board of directors. Braven sees Tencent as a supporting investor providing frontier access to the Chinese market. Others may wonder if Tencent’s intentions go further. Perhaps they will-or perhaps they will be in time.

However, for now, an imminent takeover is unlikely. Tencent has partnered with the Sumo Group, but Braben owns 33% of Frontier and has great business ambitions.

Still, this may be a good opportunity to buy stock.

Recent statement of accounts has caused astonishment. Frontier discussed the year through May 31, 2021 and acknowledged that Elite Dangerous: Odyssey, the sequel to Elite Dangerous, had a tooth-growth problem. The group also revealed that a new F1 management game will be released later than expected, following Covid-related issues.

The market reaction was unforgiving. Shares have fallen from £ 32.50 to £ 25.00 today. Still, Frontier’s long-term outlook remains compelling.

This group is working on solving problems with new elite games. Braven even publicly apologized to the customer, and sales should bounce over time. Formula 1 games are likely to be very successful once they are released, and we expect a rich pipeline of new games in the coming years.

Analysts are optimistic about the frontier and expect sales to grow 20% to £ 91m in the 12 months to May 2021 to £ 143m this year. Profit is expected to be around £ 20m over the last year and will surge to £ 33m over the year to May 2022.

Since Braven is focused on growth, there are no dividends at this time, but Frontier has a healthy balance sheet and is well-earned, which can lead to payments over time.

Midas Verdict: Games have become a multi-billion pound industry, and Frontier Developments is a leader in this area, internationally renowned and has reach. Recent bugs have been fixed, and the group still has millions of loyal fans, and Braben is committed to success. These stocks should rise at £ 25.00 with or without Tencent’s support.

Suppliers: target Ticker: FDEV contact: or 01223394 300


MIDAS SHARE TIPS: Frontier Developments Rapidly Increase Profit MIDAS SHARE TIPS: Frontier Developments Rapidly Increase Profit

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