Strong Performance and Institutional Love Calls... Is DoubleU Games Eyeing Its All-Time High?

[Asia Economy Reporter Koh Hyung-kwang] The stock price of DoubleU Games has gained momentum, rising more than 70% in the past two months. This is interpreted as a result of improved performance due to an increase in game users benefiting from the COVID-19 pandemic. With positive factors such as the subsidiary's Nasdaq listing still ahead, there is interest in whether it can break its all-time high.

According to the Korea Exchange on the 8th, DoubleU Games closed at 60,700 KRW, up 4.4% from the previous trading day on the KOSPI market. The stock price has risen more than 10% in the past week, recovering to the 60,000 KRW level for the first time in 10 months since July 16 last year. Compared to the yearly low of 35,400 KRW on March 17, when the impact of COVID-19 was at its peak, the stock surged more than 70% in less than two months.

The steady rise of DoubleU Games is underpinned by expectations of improved performance. Despite market volatility caused by COVID-19, experts have evaluated DoubleU Games as belonging to the game industry, which is relatively inelastic to economic variables, and due to the nature of the social casino genre, it holds the highest stability within the gaming industry, forecasting performance improvement.

Recent results have confirmed this evaluation. DoubleU Games announced on the 6th that its first-quarter sales this year reached 137.4 billion KRW, up 9.3% year-on-year, achieving the highest quarterly sales ever. Operating profit recorded 38.3 billion KRW, a 2.1% increase from the previous year. Choi Jin-sung, a researcher at Hyundai Motor Securities, explained, "Despite COVID-19, the growth of the flagship game DoubleDown Casino and the strong dollar helped maintain the trend of performance improvement."

Institutional investors' love calls also played a role. Institutions have been net buyers of DoubleU Games stock for 11 consecutive trading days from the 20th of last month to the day before yesterday, totaling 20.8 billion KRW. Foreign investors have also started buying this month.

With positive factors such as the subsidiary's Nasdaq listing still ahead, the outlook remains bright. Lee Moon-jong, a researcher at Shinhan Financial Investment, said, "Most of the sales come from social casinos, and over 80% of sales occur in the North American region. As the COVID-19 situation spreads in North America, increased game usage time positively affects sales, making the outlook bright after the second quarter." Kim So-hye, a researcher at Hanwha Investment & Securities, predicted, "As the growth of DoubleDown Casino (DDC) continues and the sales rebound of DoubleU Casino (DDU) becomes visible, the performance expectations for the second half of the year will rise. The planned Nasdaq listing of the subsidiary DoubleDown Interactive (DDI) in the fourth quarter is also a factor to look forward to, making it possible to surpass the all-time high from a year ago."

This content was produced with the assistance of AI translation services.