Motorsport Games Inc. (NASDAQ: MSGM)

Sector: Communication Services Industry: Electronic Gaming & Multimedia CIK: 0001821175
Market Cap 17.98 Mn
P/B 3.07
P/E 8.05
P/S 1.91
ROIC (Qtr) 37.51
Div Yield % 0.00
Rev 1y % (Qtr) 71.94
Total Debt (Qtr) 26,124.00
Debt/Equity (Qtr) 0.00
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About

Investment thesis

Bull case

  • Strong operating cash flow of 191440 provides robust 7.33x coverage of total debt 26124, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 4.13M provide 158.04x coverage of short-term debt 26124, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 6.41M provides 245.24x coverage of total debt 26124, indicating robust asset backing and low credit risk.
  • Operating cash flow of 191440 fully covers other non-current liabilities 8616 by 22.22x, showing strong long-term stability.
  • Cash reserves of 4.13M provide ample 3.44x coverage of acquisition spending 1.20M, enabling strategic growth opportunities.

Bear case

  • Operating cash flow of 191440 barely covers its investment activities of 899744, with a coverage ratio of 0.21, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of 899744 provide weak support for R&D spending of 1.89M, which is 0.48x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 191440 shows concerning coverage of stock compensation expenses of 47221, with a 4.05 ratio indicating potential earnings quality issues.
  • Free cash flow of (478816) provides weak coverage of capital expenditures of 670256, with a -0.71 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 2.28M show weak coverage of depreciation charges of 1.80M, with a 1.27 ratio indicating high capital intensity and potential reinvestment needs.

Product and Service Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Electronic Gaming & Multimedia
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 NTES NetEase, Inc. 76.19 Bn 15.89 4.76 0.91 Bn
2 EA Electronic Arts Inc. 50.25 Bn 73.90 6.88 1.89 Bn
3 RBLX Roblox Corp 43.57 Bn -40.91 8.91 1.64 Bn
4 TTWO Take Two Interactive Software Inc 34.06 Bn -8.59 5.19 3.51 Bn
5 PLTK Playtika Holding Corp. 1.22 Bn 14.21 0.45 2.54 Bn
6 SOHU Sohu.com Ltd 0.46 Bn 1.16 0.78 0.00 Bn
7 GRVY GRAVITY Co., Ltd. 0.45 Bn 8.02 1.09 0.00 Bn
8 DDI DoubleDown Interactive Co., Ltd. 0.43 Bn 4.17 1.19 0.04 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.55 0.73
EV to Cash from Ops. EV/CFO 81.75 9.02
EV to Debt EV to Debt 599.08 42.93
EV to EBIT EV/EBIT 6.85 5.14
EV to EBITDA EV/EBITDA 4.10 -0.17
EV to Free Cash Flow [EV/FCF] EV/FCF -32.69 2.00
EV to Market Cap EV to Market Cap 0.87 0.31
EV to Revenue EV/Rev 1.66 -278.61
Price to Book Value [P/B] P/B 3.07 5.21
Price to Earnings [P/E] P/E 8.05 5.61
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 1,143.22
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 15.62
Dividend per Basic Share Div per Share (Qtr) 0.00 0.31
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 21.95
Interest Coverage Int. cover (Qtr) 46.17 2.42
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -2,134.19 -144.92
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 449.76 2,047.52
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 2.39
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -19.73 10.58
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 52.20 -40.36
EBIT Growth (1y) % EBIT 1y % (Qtr) -19.73 28.44
EBT Growth (1y) % EBT 1y % (Qtr) -15.87 -25.09
EPS Growth (1y) % EPS 1y % (Qtr) -103.48 -25.14
FCF Growth (1y) % FCF 1y % (Qtr) 91.01 -203.71
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 21.37 977.78
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.93 0.61
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.03
Cash Ratio Cash Ratio (Qtr) 1.25 1.98
Current Ratio Curr Ratio (Qtr) 1.92 4.93
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 -1.05
Interest Cover Ratio Int Coverage (Qtr) 46.17 2.42
Times Interest Earned Times Interest Earned (Qtr) 46.17 2.42
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 43.30 9,395.66
EBIT Margin % EBIT Margin % (Qtr) 24.23 10,488.08
EBT Margin % EBT Margin % (Qtr) 23.71 -43,333.75
Gross Margin % Gross Margin % (Qtr) 72.50 57.20
Net Profit Margin % Net Margin % (Qtr) 23.70 -43,332.40