Streaming entertainment provider Genius Brands (NASDAQ:GNUS) isn’t on everyone’s radars. Yet, GNUS stock is a content provider play with strong growth potential in 2023. It’s risky, no doubt, but a speculative stake in Genius Brands could produce surprising returns this year.
Hailing from California, Genius Brands is known for its broad selection of family-friendly content. Most financial traders probably focus on more adult-oriented streaming entertainment producers. Genius Brands could be a hidden gem, and the company’s shares are easily affordable.
As we’ll discover, Genius Brands is growing in more ways than one. Don’t invest your entire portfolio in Genius Brands, but consider taking a long position before other geniuses catch on to this intriguing little company.
What’s Happening With GNUS Stock?
GNUS stock hit its head on the $1 resistance level twice in 2022 but was rejected both times. Maybe the third time will be a charm in 2023, as resistance levels are meant to be broken sooner or later.
Depending on when you buy Genius Brands shares, a rally to $1 could produce returns of 20%, 30% or more. That would be a decent profit in 2023 if it happens. Can it actually happen, though?
It’s a tough call to make. Genius Brands is one of those small companies that has demonstrated powerful revenue growth (951% year over year in 2022’s third quarter) but also reported a widening net earnings loss during that timeframe.
There’s a risk that Genius Brands’ net loss will widen even further. However, it’s hard to argue with the company’s revenue growth, which occurred despite high inflation and widespread recession fears.
Genius Brands Is a Rapidly Growing Company
What’s encouraging about Genius Brands is that it’s a focused but growing business. For instance, the company recently consolidated its broad array of consumer platforms into an umbrella brand, Genius Networks.
Soon afterward, the company launched a new business enterprise called Genius Music. This unit should help to diversify Genius Brands’ already wide-ranging business model. Genius Music is intended to “create multiple revenue streaming opportunities” as the division develops a “library of over 8,000 original premium production tracks.”
On top of all that, Genius Brands is extending its global presence with the launch of its Kartoon Channel! in Africa. The channel’s offerings are already available in “key territories around the world,” including Australia, New Zealand, Germany and the Philippines.
If you don’t have children, Genius Brands and its intellectual property portfolio might be unfamiliar to you. Nevertheless, Genius Brands is clearly gaining traction as a global content provider for kids, both domestically and abroad.
GNUS Stock Can Hit $1 in 2023
GNUS stock has hit resistance at $1 on more than one occasion. The company’s revenue expansion suggests that Genius Brands deserves a re-rating on Wall Street sometime this year.
Besides, Genius Brands is venturing into multiple geographic regions with a broad variety of content, including both video and music. Granted, there’s risk involved since Genius Brands isn’t a profitable business. With that in mind, however, it’s fine to take a small share position in Genius Brands with a $1 price target for 2023.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.