Tuesday, May 17, 2022
Motorsport Games (MSGM)
Moving Forward At A Slightly Slower Speed
Motorsport Games, a Motorsport Network company, combines innovative and engaging video games with exciting esports competitions and content for racing fans and gamers around the globe. The Company is the officially licensed video game developer and publisher for iconic motorsport racing series across PC, PlayStation, Xbox, Nintendo Switch and mobile, including NASCAR, INDYCAR, 24 Hours of Le Mans and the British Touring Car Championship (“BTCC”). Motorsport Games is an award-winning esports partner of choice for 24 Hours of Le Mans, Formula E, BTCC, the FIA World Rallycross Championship and the eNASCAR Heat Pro League, among others.
Michael Kupinski, Director of Research, Noble Capital Markets, Inc.
Patrick McCann, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Favorable Q1 results. The company reported strong Q1 revenue of $3.3 million, 95% higher than our estimate of $1.7 million. Adj. EBITDA loss of $5.55 million was in line with our forecast. The company benefited from diversified revenue in the quarter, with 27% of total revenue coming from rFactor 2 and esports. The revenue diversification demonstrates the company’s ability to derive value from more than just its NASCAR franchise.
Product roadmap changes. Management noted that the company will focus on console and PC games in the near term given strong demand in those areas. Additionally, the company will not release a new NASCAR Ignition title this year, opting to release an expansion pack to the current title instead. Release of the next iteration of the game is planned for mid-2023….
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
