Well-regarded fund manager Peter Hodson of Sprott Asset Management presented a compelling investment case for Gravity Co. (NASDAQ:GRVY) in an interview with Canada's Business News Network on August 6th. Hodson's argument is in line with the thesis presented in a recent issue of Downside Protection Report.
Gravity is a Korean software company, developing massively multiplayer online role-playing games ((MMORPG)). Despite the company's recent profitability inflection point, the shares continue to trade roughly in line with net cash and investments. While the shares have appreciated considerably this year, they remain undervalued and still trade at a price that is lower than two years ago. Gravity's valuation compares favorably to public companies such as Shanda Interactive Entertainment (NASDAQ:SNDA), Giant Interactive Group (NYSE:GA), NetEase.com (NASDAQ:NTES), Perfect World (NASDAQ:PWRD), and The9 Limited (NASDAQ:NCTY).
Disclosure: Long GRVY, no position in SNDA, GA, NTES, PWRD, NCTY.