Berenberg hikes target price on Frontier Developments
Analysts at Berenberg hiked their target price on video games developer Frontier Developments from 2,500.0p to 3,500.0p on Thursday after the group delivered another strong trading update a day earlier.
Berenberg highlighted that Frontier Developments' update showed trading across all four of its franchises was ahead of expectations and noted that with Elite Dangerous player numbers at their highest level in history, the release of its Odyssey title later in the year could be a step change for the franchise.
"While Frontier's shares are expensive, its growing portfolio of high-quality, long-lifecycle franchises is worth the premium," said the analysts, who also reiterated their 'buy' rating on the stock.
The German bank also acknowledged that Frontier has tightened full-year 2021 sales guidance to £90.0m-95.0m but added that with the Odyssey console and Lemnis Gate releases added to the 2022 trading year, it saw fit to increase its sales estimates by 4% to £150.0m, ahead of company compiled consensus of £133.0m-153.0m.