Korea Small Cap Gem #29: Com2Us

• Com2Us's net cash (including long-term financial investments) is 151% of its market cap. It is trading at P/B ratio of only 0.45x.

• The company paid out 2,600 won in DPS in FY23. If we assume the same DPS, this would suggest a dividend yield of 6.7% at current price of 38,900 won.

• Com2Us is a turnaround story. It had an operating profit of 1.2 billion won in 1Q 2024, improving from an operating loss of 13.3 billion won in 1Q 2023.

Com2Us Company Background

Com2us Corp (078340 KS) is one of the top 10 game companies in Korea with a market cap of 496 billion won (US$365 million). After reaching a high in share price of 186,200 won in June 2018, its share price has fallen nearly 79% to 38,900 won. The company is one of the first major mobile game developers in Korea. It is well known for its popular RPG game 'Summoners War.'

Balance Sheet Analysis

Com2Us has an excellent balance sheet. Its cash, short term investments, and long-term financial investments was 961 billion won at the end of 1Q 2024. It also had debt of 210 billion won at end of 1Q 2024. Its net cash (including long-term financial investments) is 151% of its market cap. Debt ratio was 40% and current ratio was 118% at end of 1Q 2024. It had total equity (controlling interest) of 1.1 trillion won at the end of 1Q 2024 and it is trading at P/B ratio of only 0.45x.