In this equity research report, analysts Henri de Vietri and Albin Pehrson take a closer look at Modern Times Group (MTG), a
market leader in mobile-gaming. MTG is set to achieve a revenue CAGR of 5.7% through 2029E, driven by high-performing IPs
such as Raid: Shadow Legends and improved ARPDAU across its portfolio. With a forecasted FCFF yield of 13.7% by 2026E
based solely on its existing customer base and stable cash flows from low-churn games, MTG presents growth potential with
low downside risk. Based on an equally weighted DCF and peer valuation, a target price of SEK 138.1 is implied, showcasing a
potential upside of 50.7%.
Investment Highlights:
● A portfolio shift toward high-retention in-app purchase games enhances long-term earnings stability and quality
● Plarium’s monetization strategies are expected to drive a 2.2% ARPDAU CAGR, contributing to an estimated 5.7%
topline CAGR through 2029E
● Strong IPs sustain recurring revenue with an asymmetric risk reward profile, offering a 19.8% upside