I’ve been looking at GRVY, and it seems massively undervalued.
At \~$60/share and \~6.9M shares outstanding, the market cap is around \~$420M. The company’s book value is around \~$440M, with over 400M in cash on the books.
So the market is basically valuing the entire operating business at close to nothing
This is not a distressed company. Gravity is profitable, has been profitable for years, and has continued building cash while the stock has mostly traded sideways for roughly five years. The business has generated hundreds of millions in cumulative profit/cash over that period, but the market has not really rewarded it.
Why I think it’s interesting:
* Market cap is roughly in line with cash/financial assets (so how can the price possibly go down and stay down)
* Book value appears above the market cap
* Profitable business
* No debt
* Ragnarok remains a major IP in Asia
* Ragnarok 3 is expected end of this year
* Recent Q1 results were strong
* A new filing (today) suggests the company may be preparing for a potential interim dividend
That last point is the big new development.
To my knowledge, GRVY has never paid a dividend before. The company just filed to set a June 30, 2026 record date and close its shareholder register from July 1–10 to determine shareholders eligible for a potential interim dividend. The amount and final decision still need to be determined by the board, so this is not a declared dividend yet.
But for a company that has historically hoarded cash and returned basically nothing to shareholders, even opening the door to a dividend is huge! I think the fact they have hoarded cash and gave nothing back to investors is the only real draw back to the company and it looks like that could be in the past?
My view:
The downside looks unusually cushioned by the balance sheet, while the upside could come from any re-rating if management finally starts returning capital to shareholders.
It looks like the market is valuing GRVY as if the cash will never matter and the business deserves almost no value.
Curious on any thoughts you might have