{"id":415238,"date":"2020-08-31T05:09:34","date_gmt":"2020-08-31T09:09:34","guid":{"rendered":"https:\/\/financhill.com\/blog\/?p=415238"},"modified":"2020-08-03T10:18:13","modified_gmt":"2020-08-03T14:18:13","slug":"gravity-stock-forecast","status":"publish","type":"post","link":"https:\/\/financhill.com\/blog\/investing\/gravity-stock-forecast","title":{"rendered":"Gravity Stock Forecast"},"content":{"rendered":"<p><a href=\"https:\/\/www.history.com\/news\/life-for-the-average-family-during-the-great-depression\" target=\"_blank\" rel=\"noopener noreferrer\">The Great Depression<\/a> completely changed life from its foundation for the average person, as households embraced frugality across all income brackets.<\/p>\n<p>It\u2019s something that occurred in a much different way during the 2020 economic crisis caused by the novel coronavirus.<\/p>\n<p>As people worldwide were ordered to remain home, we dug into streaming entertainment, especially video games.<\/p>\n<p>In fact, we played so many video games that developers like <strong>Gravity Co., LTD (<a href=\"https:\/\/financhill.com\/search\/seasonality\/GRVY\">NASDAQ:GRVY<\/a>)<\/strong> reported strong earnings and a healthy recovery from the initial impact across the entire market.<\/p>\n<p>Gravity is a 20-year-old Korean game development company that\u2019s best known for its Ragnarok massively multiplayer online role-playing game (MMORGP) series.<\/p>\n<p>The games generated so much revenue this year that the company outperformed the <a href=\"https:\/\/financhill.com\/search\/seasonality\/SPY\">S&amp;P500<\/a> in the aftermath of COVID-19. Let\u2019s take a look at the Gravity stock forecast to determine whether it\u2019s a good investment for those just now jumping on board.<\/p>\n<h2>Gravity = Korean Video Game Developer<\/h2>\n<p>If you\u2019re not familiar, <em>Ragnarok<\/em> is an uber popular manhwa (the Korean term for comics) that blends Norse mythology with a variety of fantasy elements. Much like History Channel\u2019s <em>Vikings<\/em> TV series, it also blends in Christianity and other cultural elements.<\/p>\n<p><em>Ragnarok Online<\/em> launched in August 2002 on Windows PCs, and it spawned a variety of sequels across PC and mobile platforms, along with an animated series. It also launched about a dozen non-related titles for each platform, but this franchise is the main draw, which is both a strength and weakness.<\/p>\n<p><strong>Gravity\u2019s most recent releases are <em>Ragnarok M<\/em>: <em>Eternal Love,<\/em> another installment that captures the feel of the original while pulling in new audiences and <em>Ragnarok Origin<\/em>, which hit the top 5 in Korea\u2019s App and Play Stores upon its July 2020 release<\/strong>.<\/p>\n<p>Although the same franchise, the initial sequel wasn\u2019t well received in the 2010s, so the company\u2019s revenue hinges on these games for this year.<\/p>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/stock-score\/ATVI\" width=\"720\" height=\"500\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<p>North American <strong>Activision Blizzard\u2019s (<a href=\"https:\/\/financhill.com\/search\/charts\/ATVI\">NASDAQ:ATVI<\/a>)<\/strong> MMORPG legend <em>World of Warcraft<\/em> is arguably the most successful MMORPG of all time, and it has a much different strategy.<\/p>\n<p>Not only does Blizzard have other IPs (<em>Starcraft, Overwatch, Heroes of the Storm, Diablo, etc.<\/em>), but it still maintains the same servers for its original <em>WoW<\/em> launch, simply adding new expansion packs to the same world. This begs the question of whether this stock is a buy.<\/p>\n<h2>Is Gravity Stock A Buy?<\/h2>\n<p>While North American audiences are only mildly aware of <em>Ragnarok<\/em>, it has a cult following in Southeast Asia. When the coronavirus hit, countries like South Korea were among the<a href=\"https:\/\/www.npr.org\/sections\/goatsandsoda\/2020\/03\/26\/821688981\/how-south-korea-reigned-in-the-outbreak-without-shutting-everything-down\" target=\"_blank\" rel=\"noopener noreferrer\"> first to react<\/a>, although Korea notably didn\u2019t shutdown.<\/p>\n<p>Instead, the company pushed forth social distancing measures that were naturally integrated into a society that already enjoyed streaming entertainment and gaming. This helped catapult the latest <em>Ragnarok<\/em> releases to the top of the charts.<\/p>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/stock-score\/GRVY\" width=\"720\" height=\"500\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<p>The company is also partnered with TikTok\u2019s Chinese parent company ByteDance to develop and release <em>Ragnarok X: Next Generation<\/em> across Southeast Asia. Because MMORPGs have a ton of revenue streams, it\u2019s easy to see how the company can be seen as a cash cow.<\/p>\n<p>With consumer sentiment in 2020 leaning toward nostalgic, it\u2019s a good bet that we\u2019ll see a resurgence of <em>Ragnarok<\/em>, especially with streaming services like Netflix and Disney Plus loaded with supplemental Norse mythology.<\/p>\n<p>Of course, that doesn\u2019t mean there aren\u2019t associated risks. By the time you\u2019re reading this, the stock could already be at its peak, considering it\u2019s been hitting all-time highs all summer.<\/p>\n<h2>Will Gravity Stock Fall?<\/h2>\n<p><strong>Video games is a big business, with over 2.7 billion gamers spending over <a href=\"https:\/\/www.statista.com\/topics\/868\/video-games\/#:~:text=Video%20games%20are%20a%20billion,over%2077%20billion%20U.S.%20dollars.\" target=\"_blank\" rel=\"noopener noreferrer\">$70 billion<\/a> on them each year<\/strong> in the 2010s.<\/p>\n<p>Not only is playing games a hobby, but with esports leagues and streaming services like Twitch, it\u2019s a more normalized profession than ever before.<\/p>\n<p><strong>Many universities even have esports teams, and that\u2019s good news for anybody who loves video games as an art form and industry.<\/strong><\/p>\n<p>Not everything is rosy for Gravity nor <em>Ragnarok<\/em> though, and Loki made a tricky situation for the company\u2019s partnership with ByteDance. The company became the <a href=\"https:\/\/www.reuters.com\/article\/us-usa-tiktok-bytedance-exclusive\/exclusive-tiktoks-chinese-owner-offers-to-forego-stake-to-clinch-u-s-deal-sources-idUSKBN24X3SK\" target=\"_blank\" rel=\"noopener noreferrer\">focal point of U.S.-China relations<\/a> due to government monitoring code hardwired into its popular TikTok app.<\/p>\n<p>In fact, Chinese companies like Huawei are <a href=\"https:\/\/www.wsj.com\/articles\/china-may-retaliate-against-nokia-and-ericsson-if-eu-countries-move-to-ban-huawei-11595250557\" target=\"_blank\" rel=\"noopener noreferrer\">being banned from cell networks<\/a> as the world upgrades to 5G, and this partnership could prove divisive in promoting the next mobile release.<\/p>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/charts\/GRVY\" width=\"720\" height=\"700\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<p>Gravity also has a painfully shallow lineup of IP that all but drops off in popularity after <em>Ragnar\u00f6k.<\/em> <strong>Without much of a safety net behind it, the IP risks falling victim to shifting trends, cancel culture, and other problems. <\/strong><\/p>\n<p>It\u2019s always safer to have something else on deck for the next big thing when your flagship falters \u2013 Nintendo, for example, has Kirby, Donkey Kong, Zelda, and others to draw in anyone who doesn\u2019t like Mario. This brings questions about Gravity\u2019s competition to the forefront.<\/p>\n<h2>Gravity Has Stiff Competition<\/h2>\n<p>Although Gravity is doing well in its native country, it\u2019s not outperforming Korean competitors like Nexon, PUBG Corporation, and Netmarble on the global gaming market. And that\u2019s just the local competition \u2013 aside from the gaming giants already mentioned in this article, there are the likes of Microsoft, Ubisoft, Electronic Arts, Square Enix, and Namco to deal with. That\u2019s not even to mention that none of Gravity\u2019s games are currently available on any of the major consoles.<\/p>\n<p><iframe loading=\"lazy\" style=\"margin: 0 auto; border: 0;\" src=\"https:\/\/financhill.com\/widget\/charts\/EA\" width=\"720\" height=\"700\" frameborder=\"0\" scrolling=\"no\" seamless=\"\"><\/iframe><\/p>\n<p>This leaves a lot of room for the competition to outplay Gravity at its own game, perhaps even introducing a similar IP using the same basic mythology. All of these are possibilities that leave analysts wondering where this company\u2019s stock will peak.<\/p>\n<h2>Gravity Stock Forecast: The Bottom Line<\/h2>\n<p>Gravity is on its way up due to a renewed interest in its <em>Ragnarok<\/em> IP and a series of new games based in the world. As the coronavirus creates lockdowns around the globe, Gravity has an attentive audience ripe for the picking. It needs to gain a stronger foothold outside its Southeast Asia comfort zone to continue its growth trajectory though. Invest with caution.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Great Depression completely changed life from its foundation for the average person, as households embraced frugality across all income brackets. It\u2019s something that occurred in a much different way during the 2020 economic crisis caused by the novel coronavirus. As people worldwide were ordered to remain home, we dug into streaming entertainment, especially video [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":415241,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"content-type":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[22],"tags":[],"class_list":["post-415238","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/financhill.com\/blog\/wp-content\/uploads\/2020\/08\/gravity-stock-forecast.jpg","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p9czeV-1K1o","_links":{"self":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/415238","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/comments?post=415238"}],"version-history":[{"count":3,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/415238\/revisions"}],"predecessor-version":[{"id":415242,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/posts\/415238\/revisions\/415242"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/media\/415241"}],"wp:attachment":[{"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/media?parent=415238"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/categories?post=415238"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financhill.com\/blog\/wp-json\/wp\/v2\/tags?post=415238"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}