Analysts at Leede Jones Gable have initiated coverage on Gamelancer Media Corp. (CSE:GMNG, OTCQB:GAMGF) with a ‘Buy’ rating and C$0.40 price target, a 300% upside on the stock’s current price.
In a note to clients, the analysts wrote that, as social media has changed how companies communicate with their target audiences, Gamelancer was at the forefront of this movement.
Gamelancer owns the top gaming network on TikTok with a following of more than 41 million users, growing at 1.5 million followers per month and generating billions of monthly views.
“Using advanced user data analytics, the company provides its audience with content that is relevant to the Gen Z and millennial communities, thereby granting its clients access to this highly valuable but elusive gaming audience,” they wrote.
They added that Gamelancer’s partnership with TikTok solidifies its position as a top media partner for brands and content creators.
“As a TikTok partner, Gamelancer's creators will have increased visibility and reach, access to monetization features, analytics and support, collaboration opportunities, and recognition and credibility,” they wrote.
Gamelancer’s partnership with Snapchat allows it to broaden its original content offerings, broadcast trending videos, and increase revenue, according to the analysts.
“With over 383 million daily users worldwide, Snapchat's popularity among 13 to 34-year-olds offers enormous potential for Gamelancer,” they wrote.
“Its current Snapchat presence already generates over $440,000 in monthly recurring revenue, up 340% year-over-year. This partnership is expected to have a direct and positive impact on the company's monthly earnings.”
The analysts also highlighted that Gamelancer generates significant first-party data which is critical to the new world of advertising with Google set to remove third-party cookies from its Chrome browser by the end of 2024.
“As advertisers come to rely more heavily on first-party data to target users with advertisements, companies such as Gamelancer will profit, as they generate a vast amount of first-party data from their 54 owned and operated channels, which generate more than 2 billion monthly views,” they wrote.
On “the elephant in the room,” a potential ban of TikTok in the United States over national security and other concerns and how this would impact Gamelancer, the analysts noted that there remained uncertainty.
“It remains to be seen whether the Biden administration will take additional action against TikTok, but it is evident that the app will continue to be scrutinized and regulated over the coming years,” they wrote.
“Marketers and agencies must remain flexible and prepared to adapt their advertising strategies, while also keeping an eye out for future policy changes that could impact social media advertising.”
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