Are These The Best Entertainment Stocks To Buy Now?
Entertainment stocks are among the most relatable industries in the stock market. For any investor, it is crucial to understand the industry a company is operating in. Fortunately, most of the entertainment stocks are household names in the industry. Safe to say, everyone needs some form of entertainment as distractions from work or any other form of stress. Furthermore, the global pandemic has been difficult for many but a blessing in disguise for entertainment companies. With the rapid advancement of technology these days, there are many forms of indoor entertainment available today.
People were forced to stay indoors and resorted to streaming services or gaming to keep themselves entertained. So, from gaming companies like Activision Blizzard, Inc (NASDAQ: ATVI) to streaming companies such as Spotify Technology SA (NYSE: SPOT), their offerings were in high demand over the past year. On top of that, with the resurgence of the delta variant of coronavirus, entertainment stocks could be back in focus. With that in mind, could one of these entertainment stocks in the stock market be worth watching now?
Top Entertainment Stocks To Watch This Month
- Netflix Inc (NASDAQ: NFLX)
- Walt Disney Co (NYSE: DIS)
- Roku Inc (NASDAQ: ROKU)
- Comcast Corporation (NASDAQ: CMCSA)
First up, we have the pioneer video streaming company, Netflix. Its subscribers can watch content from Netflix through any Internet-connected device, including televisions (TVs), digital video players, television set-top boxes, and mobile devices. Recently, the competition in the video streaming industry has been on the rise. That said, Netflix still boasts one of the largest active user counts among streaming providers. After all, the company does offer consumers top-quality content from both international and its own studios.
Last month, the company posted its second-quarter earnings report. As expected, the growth of the company would slow down as the economy recovers and people are stepping outdoors again. Also, it should be taken into consideration that the pandemic-driven growth was not one that’s sustainable in the long term. That said, it still reported total revenue of $7.34 billion, marking a 19% increase year-over-year. Moreover, its net income and earnings per share soared by 87% and 86% respectively over the same period.
Overall, Netflix is still fundamentally very strong and now boasts over 209 million paid subscribers. Notably, the company recognizes the rising competition in streaming services and now plans to join the video gaming industry. For now, it is looking to offer ad-free games for subscribers on its mobile platform. Expanding its core business could contribute positively to Netflix’s long-term growth. Given all these, would NFLX stock make it to the top of your watchlist?
Walt Disney Co
Following that, we have Walt Disney. Most are introduced to Walt Disney at a young age through its animated classics such as Sleeping Beauty, Snow White, and many more. That said, the company’s entertainment business has grown exponentially over the past few decades. It now has four segments, Media Networks, Park Experiences and Products, Studio Entertainment, and Direct-To-Consumer (DTC). DIS stock has been up by over 35% over the past year.
Recently, Disneyland Resort announced that it is overhauling its 37-year-old annual pass program. This aims to reduce crowding on high-demand days, replacing it with a program that will require reservations before entering the theme parks, while blocking out access on the busiest days. Although the overall prices of the Magic Key passes are lower than the previous passes, the number of days park-goers can visit is also now limited. As of now, the new pass program is only for Disneyland and California Adventure Park.
As some of you may be aware, the company’s streaming service, Disney+ has been a huge success since its launch. In India, Disney+ Hotstar has an estimate of 38 million households subscribed to the streaming service by the end of June. This accounts for more than one-third of global Disney+ subscribers. Now that the company is due to announce its fiscal third-quarter earnings report on August 12, will Disney+ continue its trajectory to be one of the top video streaming platforms in the world today? With that in mind, would you consider DIS stock a top entertainment stock to watch?
Roku is a company that provides a television streaming platform. Essentially, it pioneered streaming to the TV. Content publishers can build and monetize large audiences and provide advertisers with unique capabilities to engage consumers. Channels that can be found on its platform include CBS News, HBO Now, Hulu, Netflix, and many more. ROKU stock is one of those that has sustained its bullish momentum, showing gains of over 130% over the past year.
Last week, Roku announced its highly anticipated second-quarter earnings report. Some key results that caught the attention of investors were its revenue that grew by 81% to $645 million year-over-year. Meanwhile, it posted a gross profit of $338 million, up by 130% year-over-year. Overall, Roku delivered a strong second quarter, with record revenue growth that was driven by exceptional performance in platform monetization.
Another key metric to look out for will be its number of active accounts which amounted to 55.1 million. As audiences, content, and advertisers continue to shift to TV streaming globally, Roku has been a key enabler for this long-term secular trend. Despite a decrease in streaming hours from the previous quarter, streaming hours still increased nearly 19% globally on a year-over-year basis. Considering that, do you believe that there is more room to run for ROKU stock?
Let us sum up the list with the media technology company, Comcast. The company has three primary businesses, Comcast Cable, NBCUniversal, and Sky. In essence, it operates various types of communication services that range from film entertainment to wireless, voice, and video services.
Just last week, the company announced that it has been awarded another multimillion-dollar contract by the U.S. Defence Information Systems Agency (DISA). This is a part of the Agency’s effort to replace legacy circuits across the country with Ethernet-based services to improve network performances and costs. So, Comcast has now won five Commercial Ethernet Gateway regions for a total of more than $343 million covering 35 states nationwide. The confidence shown by DISA in the company’s services is a testament to its excellent track record over the years.
On top of that, the company recently posted another strong financial quarter. Its revenue came in at $28.5 billion, up by 20.4% year-over-year for its second quarter. Meanwhile, its net income increased from 24.3% to $3.9 billion. It appears that the company is able to continue its momentum from the start of the year. So, should you be buying CMCSA stock after such a strong financial showing?