Are These Top Entertainment Stocks Worth Investing In Right Now?
Entertainment stocks have been making headlines this year. Investors and non-traders alike have likely heard of the trading frenzy initiated by Reddit users recently. Specifically, internet day traders flocked towards entertainment companies that would fall under the category of epicenter stocks. The likes of AMC Entertainment (NYSE: AMC) and GameStop (NYSE: GME) were among the key targets of this movement. Despite having fallen from the heights of their monstrous rallies, both top entertainment stocks are still looking at gains of over 180% year-to-date. Of course, this would make investors wonder if there is more to gain from the industry beyond this incident.
Well, some would argue that the aforementioned companies could make a comeback in a post-pandemic world. Seeing as physical entertainment experiences would make a comeback that could be the case. But, for today, we will be looking towards the booming digital entertainment sector. For instance, you have streaming companies such as Netflix (NASDAQ: NFLX). Through its streaming platform, the company continues to keep its over 200 million subscribers entertained at home. With sizable gains of over 85% since the March lows, the company’s presence in digital entertainment has clearly brought investors returns. As such, here are four top entertainment stocks to watch right now.
Best Entertainment Stocks To Buy [Or Sell] Now
- Walt Disney Company (NYSE: DIS)
- Roku Inc. (NASDAQ: ROKU)
- FuboTV Inc. (NYSE: FUBO)
- Spotify Technology (NYSE: SPOT)
Walt Disney Company
If you had told me over a year ago that Disney’s key source of revenue would be its streaming services, I would not have believed you. Yet, its Disney Plus (Disney+) service continues to dominate the streaming space. This development came at the best time for the company who took massive hits when it had to close all of its physical entertainment revenue streams. With its broad entertainment portfolio containing legendary IPs such as Star Wars and Marvel, the company made the most of what it had.
Not to mention, the mass media juggernaut also has a plethora of Disney originals which most people grew up watching. Given its impressive collection of content, consumers naturally flocked to it. Similarly, investors have been doing the same for DIS stock, helping it exceed pre-pandemic levels towards new heights.
In its recent-quarter fiscal posted last Thursday, the company wowed investors with its latest streaming figures. Impressively, Disney+ currently has over 94.9 million subscribers, smashing the company’s 2024 estimate figure set back in November. Subsequently, it updated its 2024 subscriber forecast to 230 million to 260 million. With plans for about 100 films and television projects on its pipeline, Disney does not seem to be backing down in the streaming wars. Do you think DIS stock will continue to flourish because of this?
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Another top entertainment stock in focus now would be Roku. The digital media player manufacturer has become a go-to for investors looking towards the entertainment industry. Evidently, ROKU stock is looking at gains of over 630% since the March selloffs. I can see why. Essentially, the company not only sells streaming hardware but also hosts several top streaming services on its platform. In this sense, the company can ride the streaming wave while profiting off of subscription fees and ad revenues. More recently, it seems that Roku has no plans of slowing down anytime soon.
Just yesterday, the company posted a job listing for a “Lead Production Attorney” on LinkedIn. In the job description for this listing, Roku mentions “expanding slate of original content” as a key responsibility. To summarize, this could indicate Roku is looking to start producing in-house content.
Should this be the case, the company would be making a timely play as most of its competitors already produce their own content. Moreover, if Roku can deliver quality content, it would further incentivize subscribers to spend more hours streaming. In turn, this would help boost ad revenue in the long run. All things considered, will you be investing in ROKU stock?
Following that, we have sports streaming giant Fubo. For the uninitiated, the streaming company focuses mainly on providing live major sports league content to its viewers. On top of that, it also offers news, network television series, and movies. With sports fans around the globe still unable to attend live matches, Fubo brings the game to their living rooms. As a result, the company saw a 63% year-over-year rise in subscribers throughout 2020. In terms of ad revenue, it reported a 64% year-over-year increase in its recent quarter fiscal as well. As expected, FUBO stock has become a hot pick for investors with gains of over 400% in the past year.
Earlier this month, the company announced its support of the open-source, interoperable identity solution, Unified ID 2.0 (UID). Basically, UID allows organizations to market relevant ads to consumers while protecting their privacy. Namely, this was done in collaboration with The Trade Desk (NASDAQ: TTD) and other digital advertising companies.
Fubo is now part of the UID initiative as a connected TV (CTV) partner. With CTV representing 93% of its total viewing hours, the company is making a smart play. With the help of UID, Fubo would be able to better monetize its core content. Does this make FUBO stock a buy for you?
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Next, we will be looking at leading music streaming company Spotify. It is no understatement to say that the company is a prominent name in the music streaming industry. To begin with, Spotify now provides over 345 million monthly active users access to over 70 million tracks across the globe. From the latest songs to classic oldies, Spotify often has it all.
That’s not all, the company has also been making major plays in the podcast business as well. Spotify added 1.5 million podcasts to its platform last year. Likewise, it was estimated that U.S. podcast listenership in 2020 skyrocketed by 90%. It is no wonder then, that SPOT stock is up by over 140% in the past year. In fact, it hit a record during intraday trading yesterday on account of its latest announcement.
Yesterday, Spotify revealed that Mona Sutphen could be joining its Board of Directors, pending shareholder approval. Sutphen is a private equity advisor and an advisor for several tech start-ups. More notably, she was also a senior White House official during the Obama administration. Given her rich experience in both the private and public sectors advising leaders, Sutphen is a solid addition to the team. By and large, Spotify seems to be firing on all cylinders. Given all of this, will you be adding SPOT stock to your portfolio?