NOBLE Capital Markets analysts have initiated coverage on shares of game developer and publisher Snail, Inc (NASDAQ:SNAL) with an ‘Outperform’ rating and a “conservative” target price of $9 per share, saying the company has a broad range of opportunities to grow revenue through additional games, expansion packs, and alternative ways to use its IP.
The company's shares are currently trading at $1.35 on the Nasdaq.
The analysts said they expect the company’s 2023 revenues to increase by 25% to $93 million, while anticipating an even stronger 80% revenue growth in 2024 to $167.7 million, due to the launch of the sequel of its popular ARK game.
“Its flagship gaming franchise, ARK, is one of the most successful in the sandbox of the survival game genre, with roughly 84 million installs and more than 3 billion hours of total playing time,” the NOBLE analysts said.
“In spite of the broad success and popularity of its games and favorable identity from the gaming community, we believe that the company is largely undiscovered by the investment community,” they added.
The total global video game market in terms of revenue was $193 billion in 2021 and is expected to grow at a 4% compound annual growth rate (CAGR), from 2021-2025, the analysts noted while saying they believe Snail should grow faster than the industry over the next few years as it launches new products.
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