NATIXIS : Ubisoft : Return of a favourable consolidation cycle ?

* Note 10/09/2014
* Headlines already reported earlier on Asamacubi

* Some further details :

– Microsoft could acquire Mojang (Minecraft) for $ 2bn.
– This price implies a premium of 25% to the multiples at which Ubisoft is valued (forward Price Earnings).
– In fact, Ubisoft deserves a premium to Mojang, because Minecraft could just as well fade in the next months whereas Ubi’s portfolio is bigger and offers better visibility.
– Ubisoft is still a target of choice (« the best » according to Natixis) in the gaming sector, with predators such as publishers (Activision, EA) as well as film studios (Warner).

Note : Microsoft eventually paid $ 2.5 bn instead of $ 2 bn, so that implies a premium of 56% to the multiples of Ubisoft !!

– Natixis note
– Analyst : Pavel Goviciyan
– Target Price Ubisoft : € 17

Estimated EPS : 14/15 : € 0.88
15/16 : € 1.25
16/17 : € 1.63 !!!!! (looks very optimistic to me)