Equity Analyst, LightStream Research

Supun Walpola

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

This is the part one of our two-part initiating coverage report on <a href="https://www.smartkarma.com/entities/8197" target="_blank" data-smartkarma-citation="entities:8197:1">Cyberagent Inc (4751 JP)</a>. In this note, we take a closer look at CyberAgent’s business operations and their medium-term prospects under each business segment.<ul><li>Incorporated in 1998, CyberAgent is one of the top internet media companies in Japan. CyberAgent was listed on the TSE in 2000. The current market cap of the company is JPY834bn. </li></ul><ul><li>
CyberAgent has been on a strong bull-run since the end of last year. The YTD increase in share price is 48.5%. </li></ul><ul><li>CyberAgent operates under three business segments namely, Internet Advertisement, Game and Media. </li></ul><ul><li>The Internet Advertisement business offers a wide range of internet-based advertising solutions. Internet Advertisement is CyberAgent’s largest business segment accounting for c.56% of consolidated revenue. Revenue from the Internet Advertisement business increased at a CAGR of 22.3% over the past three years. The Internet Advertisement business is expected to grow by double digits in the medium term above market growth of around 15%. </li></ul><ul><li>CyberAgent is the third largest smartphone game developer in Japan. Revenue from the Game business has increased at a CAGR of 40.4% over the past three years. CyberAgent is planning on increasing the number of game titles released every year, which could result in a medium-term revenue CAGR of above 20%. </li></ul><ul><li>The Media business accounts for less than 10% of consolidated revenue and offers a range of internet media services like Abema internet TV, FLASH! live streaming platform, Ameba blog, Tapple online dating app etc. AbemaTV is still in its upfront investment stage, but already exceeds 5m weekly active users (WAU). AbemaTV is likely to breakeven in the next two years. </li></ul><ul><li>Our initial thoughts on CyberAgent are positive, as we expect strong double-digit growth across all three business segments to significantly boost CyberAgent’s topline and bottom line in the medium term. We will present our forecasts for CyberAgent and our thoughts on valuation in the second part of this report to follow. 
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This is the part one of our two-part initiating coverage report on Cyberagent Inc (4751 JP). In this note, we take a closer look at CyberAgent’s business operations and their medium-term prospects under each business segment.Incorporated in 1998, CyberAgent is one of the top internet media companies in Japan. CyberAgent was listed on the TSE in 2000. The current market cap of the company is JPY834bn. 
CyberAgent has been on a strong bull-run since the end of last year. The YTD increase in share price is 48.5%. CyberAgent operates under three business segments namely, Internet Advertisement, Game and Media. The Internet Advertisement business offers a wide range of internet-based advertising solutions. Internet Advertisement is CyberAgent’s largest business segment accounting for c.56% of consolidated revenue. Revenue from the Internet Advertisement business increased at a CAGR of 22.3% over the past three years. The Internet Advertisement business is expected to grow by double digits in the medium term above market growth of around 15%. CyberAgent is the third largest smartphone game developer in Japan. Revenue from the Game business has increased at a CAGR of 40.4% over the past three years. CyberAgent is planning on increasing the number of game titles released every year, which could result in a medium-term revenue CAGR of above 20%. The Media business accounts for less than 10% of consolidated revenue and offers a range of internet media services like Abema internet TV, FLASH! live streaming platform, Ameba blog, Tapple online dating app etc. AbemaTV is still in its upfront investment stage, but already exceeds 5m weekly active users (WAU). AbemaTV is likely to breakeven in the next two years. Our initial thoughts on CyberAgent are positive, as we expect strong double-digit growth across all three business segments to significantly boost CyberAgent’s topline and bottom line in the medium term. We will present our forecasts for CyberAgent and our thoughts on valuation in the second part of this report to follow. 


CyberAgent: Hot Internet Media Stock Up ~50% YTD (Part 1)

CyberAgent Inc

CyberAgent: Hot Internet Media Stock Up ~50% YTD (Part 1)