NEXON (NEXOY) & The Competition Critical Review

NEXON (OTCMKTS:NEXOY) is one of 188 publicly-traded companies in the “Entertainment” industry, but how does it weigh in compared to its peers? We will compare NEXON to similar businesses based on the strength of its institutional ownership, earnings, analyst recommendations, valuation, profitability, dividends and risk.

Analyst Recommendations

This is a summary of current ratings and target prices for NEXON and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NEXON	0	2	2	0	2.50
NEXON Competitors	1756	4349	9367	238	2.51

As a group, “Entertainment” companies have a potential upside of 25.90%. Given NEXON’s peers stronger consensus rating and higher possible upside, analysts plainly believe NEXON has less favorable growth aspects than its peers.

Insider and Institutional Ownership

35.6% of shares of all “Entertainment” companies are held by institutional investors. 24.2% of shares of all “Entertainment” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

NEXON pays an annual dividend of C$0.26 per share and has a dividend yield of 1.7%. NEXON pays out 25.7% of its earnings in the form of a dividend. As a group, “Entertainment” companies pay a dividend yield of 19.4% and pay out 78.7% of their earnings in the form of a dividend.

Profitability

This table compares NEXON and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NEXON	23.82%	11.39%	9.01%
NEXON Competitors	10.52%	-3.59%	-3.02%

Earnings & Valuation

This table compares NEXON and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
NEXON	$3.18 billion	$616.75 million	14.85
NEXON Competitors	$4.10 billion	$74.17 million	-9.25

NEXON’s peers have higher revenue, but lower earnings than NEXON. NEXON is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

NEXON peers beat NEXON on 8 of the 14 factors compared.

NEXON Company Profile

NEXON Co., Ltd. produces, develops, and services PC online and mobile games. It operates through five segments: Japan, Korea, China, North America, and Others. The company's PC online game titles include MapleStory, Dungeon & Fighter, and EA SPORTS FIFA ONLINE 4. The company was formerly known as NEXON Japan Co., Ltd. and changed its name to NEXON Co., Ltd. in April 2009. NEXON Co., Ltd. was founded in 1994 and is headquartered in Tokyo, Japan.