2020 seems to be a good year for the gaming industry. With more people staying at home more than ever, they are looking for entertainment and gaming is certainly one that occupies each day.
Video game stocks were trending in Wall Street last year with revenues of almost $180 billion globally. It became a money-making industry that surpasses the combined revenues of movies worldwide and the North America Sports industries. Furthermore, the gaming industry is projected to reach $250 billion in revenues by 2025.
With the potential growth outlook, analysts are bullish on the Video game stocks this year. Here are four of them worth considering:
1. Activision Blizzard (NASDAQ: ATVI)
ATVI stock was bullish last 2020 with over 81% growth from the lowest price to the last day of the year. With the second quarter getting the highest gain of 28%. Note that Q2 was the beginning of lockdowns in many countries.
According to Hymayun of investorplace, the company’s revenue garnered 270% increase year-on-year. The Call of Duty, both the Modern Warfare and Warzone titles, were the prominent revenue generators. Newly launched games also contributed to the revenues. The company became the top gaming stock pick of Morgan Stanley for this year.
2. Electronic Arts (NASDAQ: EA)
Analysts from Wall Street Journal have an overweight consensus rating on EA. With almost 72% gain from the year’s lowest price of $85.69 to the year’s highest price of $147.36. Like ATVI, the second quarter was the biggest gain of 32% for EA stock last year.
Noticeably, the company is aggressive in launching new games and live services. With potential growth prospects, EA is another gaming stock to consider buying.
3. Take-Two Interactive (NASDAQ: TTWO)
TTWO stock is another gaming stock worthy of note. It has garnered 107% gain from the lowest price to the last day of the year 2020. However, the stock price is undergoing some corrections after hitting the all-time high of $211.44 last January 8, 2021. It would be prudent for investors to wait for the strong support to show before buying.
TTWO has acquired 2 gaming companies to strengthen further its business development. Playdot, one of the acquired companies, will certainly help boost its mobile gaming sector.
The company plans to release 93 titles over the next 5 years of which 63 are core gaming titles. Moving forward TTWO shows a sustainable long-term growth prospect.
4. Zynga (NASDAQ: ZNGA)
Currently, 18 analysts have a buy rating for the ZNGA stock with 2 having overweight ratings. Nonetheless, after hitting its 52-week high of $10.69 last August 6, 2020, the stock price has been going sideways. The difference between ZNGA from other gaming stocks on the list is that ZNGA focuses on mobile gaming where it gets 96% of its revenue. It also means that their games could be played on smartphones like the Samsung Electronics Galaxy Note 20.
Additionally, the company reported $133 million in revenues from the international markets during the third quarter of 2019. And the number increased to $191 million still for Q3 a year after. ZNGA stock certainly looks attractive with its positive outlook this year.