Good morning everyone and welcome to all our new members,
Grom Social Enterprises, Inc. (NASDAQ: GROM) the social media company just for kids, and a creator of media content for animated films and televisions series.
Current price $.3355/share (at market close 9-26-22)
GROM closed the Monday session with a slight gain of 3.7% over the past Friday’s close. The company shares hit a high of $.36 early as the NASDAQ looked like it was going to turn around and then retreated in the second half of the day. Trading volume was well above the previous 4 days at 360K shares.
I want to focus on the GROM division Curiosity Ink Media (CIM) because that is where the company’s current revenues and future revenues will come from.
I can’t stress enough the potential revenues CIM could generate if they can market one of their IP franchises to a subscription video on demand (SVOD) providers (like Netflix, Amazon, Hulu, etc.). We read the articles about Netflix losing subscribers a couple months ago and children’s programming could be the niche that Netflix and others SVOD’s need to bolster their subscriber base.
Video streaming services are a huge business that was valued at $60B in 2021 and is expected to reach $330B by 2030. There are literally hundreds of choices for streaming content, I mentioned a couple of the big names above. The competition is tough for subscribers and viewership and while price is the number one consideration, content is a big deciding factor.
Companies like CIM, that produce that content, even in a niche like children’s content, are going to be in high demand as the video streaming business grows at 20% per year.
I want to remind you that Top Draw Animation (TDA), the company’s current revenue generator, falls under the CIM umbrella. TDA is based in the Philippines where it employs 400 artists to create animation projects. TDA has been generating $5M in annual revenues but may be limited by its location and exposure to more lucrative contracts.
Now with TDA being directed by the staff at CIM, I believe the client base for TDA could grow significantly. Hollywood is a big market for animation services and TDA has been missing out on a lot of that business. Now, under CIM, with a plethora of Hollywood contacts, that lucrative market may begin to grow for TDA.
The relationship between CIM and Dynamite Entertainment is an important one as Dynamite get the books derived from the company’s IP franchises onto the bookstore shelves. While some IP franchises can be instant hits with media companies, many of them need to be incubate and by that, I mean their story lines and characters must be developed and brought to the public eye. The many superhero movies that have been developed from comic books are an example.
Here is a sampling of the IP franchises that CIM and Dynamite are involved with:
Santa’s Secret Society- a book from the The Adventures of Herbert Henry franchise.
Baldwin’s Big Adventure- a book from the Baldwin franchise
Thunderous- a novel from the Thunderous franchise.
The Legion of Forgettable Supervillains- a novel from The Legion of Forgettable Supervillains franchise.
Everybody Loves Cats vs Pickles- a soon to be released book.
MR. ZIP, a book series being developed at the company.
7/26/2022 EF Hutton Acquisition Corp. Buy $2.00 418% upside
CIM has everything in motion to create higher revenues with lots of IP franchises in play and the potential for growing revenues at Top Draw Animation. In the interview I mentioned earlier with CEO Darren Marks, he mentioned the feeling of creative energy running through CIM. That’s the kind of energy that makes companies winners.
The Traders News Group
