Keywords Studios PLC (AIM:KWS, OTC:KYYWF), the production and localisation services provider to the videogames industry, generated positive responses from the City after dropping its interim results on Tuesday.
Today, equities analysts at Liberum added to the chorus with a 'buy' rating and 78% upside price target for the AIM-listed group.
Not that analysts were 100% rosy - one-off headwinds in the form of widespread strikes in the US entertainment industry and a challenging mobile gaming market have taken a bite out of short-term organic growth.
However, Liberum said investors “should look past the next six months and focus on the bigger picture where long-term trends remain strong”.
This may be slightly surprising to industry spectators who have been warning of the negative impact that generative artificial intelligence (AI) technology could have on Keywords.
Liberum disagrees with this thesis. “From that perspective, we see AI more an opportunity than a threat,” said analysts, who pointed out that Keywords’ AI strategy is one of adoption and integration as opposed to competition.
“Gaming budgets have always increased despite technological changes that should have decreased costs, and we believe this trend will continue,” Liberum predicted.
Keywords’ share price target is 2,600p against a publication price of 1,473p.