Are These The Top Gaming Stocks To Buy Now?
The stock market has not been kind to many of the growth stocks lately. And, gaming stocks are no exception. However, many still believe that the long-term potential of the industry is intact. Even e-commerce giant Amazon (NASDAQ: AMZN) is showing great interest in the gaming industry lately. Despite a questionable history in the gaming space, its recent endeavors have proven to be a huge success. Amazon Games’s Lost Ark recently passed 1 million concurrent players just after 24 hours. This makes it the second most played game in Steam history by concurrent count.
In fact, the game is trending so hard right now that players are facing server issues. Some may argue that the company did not expect this level of reception among the public. With all said and done, the gaming space is one that would likely continue to grow. Now that the metaverse is closer to being a reality, it would be reasonable to assume that the gaming industry will be part of this evolution. So, here are some of the top gaming stocks to know in the stock market today.
Gaming Stocks To Watch This Week
- Unity Software Inc (NYSE: U)
- Activision Blizzard, Inc. (NASDAQ: ATVI)
- Sea Ltd (NYSE: SE)
- Electronic Arts Inc. (NASDAQ: EA)
- Take-Two Interactive Software, Inc. (NASDAQ: TTWO)
Unity is a gaming company that plays a role in the production of some of the top games in the industry today. Put simply, the company offers a platform for creating and operating interactive, real-time three-dimensional content. This includes Create Solutions and Operate Solutions that enables customers to create and monetize their content across a range of third-party content distribution platforms. With more than 2.5 billion monthly users consuming content created or operated with Unity solutions, it should not be surprising that U stock is now gaining traction among investors.
Earlier this month, the company provided its fourth-quarter and full-year 2021 financial report. Its revenue came in at $315.9 million, up 43% year-over-year and ahead of guidance. Meanwhile, its full-year 2021 revenue was $1.1 billion, representing an increase of 44% year-over-year. In addition, Unity now expects its full-year 2022 revenue to be $1.5 billion. This exceeds analysts’ estimate of $1.43 billion. With the optimistic outlook, would you consider adding U stock to your watchlist?
Similar to Unity, Activision Blizzard is another force to be reckoned with in the gaming industry. The company is a developer and publisher of interactive entertainment content and services. Its games can be found on video game consoles, personal computers (PC), and mobile devices. Some of its most notable brands include Call of Duty, World of Warcraft, Diablo, Candy Crush, and many more. Not to mention, the company is currently involved in one of the largest deals ever by a U.S. technology company.
In January, Microsoft (NASDAQ: MSFT) announced plans of acquiring Activision, and this boosted the sentiment around ATVI stock. Besides, according to a regulatory filing, it appears Warren Buffet’s Berkshire Hathaway (NYSE: BRK.B) purchased approximately $1 billion worth of ATVI stock in the fourth quarter of 2021. The purchase happened before Microsoft agreed to buy Activision for $68.7 billion. Now, since the news of the acquisition, ATVI stock has risen approximately 25%. So, it should not be surprising that investors are now keeping a close eye on the stock.
Following that, we will be looking at the consumer Internet company, Sea. While it is renowned for being a rapidly growing e-commerce company, it also has a strong hand in the gaming space. The company’s Garena platform offers mobile and personal computer online games. Additionally, it offers e-sports and provides access to other entertainment content and social features. Besides, Garena is the developer and publisher of Free Fire, one of the most popular mobile battle royale games.
The game was one of the most downloaded mobile games globally over the past few years. However, SE stock plunged as much as 19% on Monday’s trading session. On Monday, India has banned 54 applications that it says are of Chinese origin, including Sea’s Free Fire. It’s worth noting that Sea is in fact a Singaporean company which counts Chinese tech giant Tencent (OTCMKTS: TCEHY) as a minority shareholder. That said, could the stock movement be overblown? After all, despite being one of the biggest populations in the world, India contributes less than 3% of Sea’s mobile gaming revenue. So, this may very well be a buying opportunity for those who believe in the company’s long-term prospects. With that in mind, would you consider buying SE stock right now?
Another top gaming company to note would be Electronic Arts (EA). The digital interactive entertainment company specializes in games, content, and services that cater to consumers on a range of platforms. This includes game consoles, PC, mobile phones, and tablets. With a portfolio of intellectual brands that include The Sims, Apex Legends, FIFA, and Madden NFL, to list a few, it is easy to understand why EA is one of the largest gaming companies in the world today.
EA started the month of February by announcing its preliminary financial results for its fiscal third quarter. It was a record quarter for the company as it recorded the highest net bookings, underlying profitability, and cash generation. The net bookings for the quarter were $7.25 billion, an increase of 22% year-over-year. Also, the EA player network has grown to more than 540 unique active accounts. Safe to say, the fiscal year 2022 has been an outstanding year of growth for the company. All things considered, do you believe there will be more room to grow for EA stock?
To sum up the list, we have Take-Two. In detail, the company is a developer, publisher, and marketer of interactive entertainment for people around the world. Similar to many gaming companies, its games are accessible through gaming consoles, PC, and mobile devices. Currently, it is focusing its resources on publishing a select number of titles based on internally owned and developed intellectual properties. Furthermore, it selectively develops titles based on licensed properties, including sports leagues.
Last week, the company announced a strong financial update for its fiscal third quarter of 2022. Its GAAP net revenue increased by 5% year-over-year to $903.3 million. Meanwhile, it posted a GAAP net income per diluted share of $1.24. More importantly, the company’s net bookings continue to grow despite a highly competitive gaming industry right now. With a net booking of $866.1 million which represents an increase of 6% year-over-year, the company confidently raises its outlook for the fiscal year 2022 to $3.37 billion to $3.42 billion. Given such encouraging figures, would it be the right time to jump on the TTWO stock bandwagon?