Best Video Game Stocks

The novel COVID-19 virus has changed the way we do just about everything, from getting groceries to telecommuting to work. While many industries have seen a drastic decline in average stock prices amid lockdowns and stay-at-home orders, one industry is thriving: the video gaming world. With more time spent indoors and gaming technology advancing at a faster rate than ever before, video game stocks are on the rise and popular with investors.

Quick Look at the Best Video Game Stocks:

• Hoya, Inc.
• The Nintendo Corporation
• Activision Blizzard
• Take-Two
• Capcom Co Ltd
• Sony Group Corporation

Overview

A video game is an interactive game that you can play on a console, PC, mobile phone or using a virtual reality headset. The first video game made was an interactive, simple tennis game, similar to the classic 1970s video game Pong, with the objective of keeping a virtual ball bouncing between two competing targets. 

In this early version, players twisted a knob to adjust the angle of a ball and press a button to hit the ball toward the other player. Pong was developed in October 1958 by physicist William Higinbotham, and quickly grew to be a hit with both players and observers at the Brookhaven National Laboratory open house.

Today’s video games are much more complex and immersive, with branching storylines, HD graphics and distinct control systems. Video games are often produced by major tech corporations that issue stock, but many video games are also produced by independent development teams and released to online PC gaming marketplaces like Steam or GOG.com.

The most complex video games are referred to as “AAA games,” an informal classification that indicates that a game was produced by a major publisher. AAA usually have high marketing and development budgets and are similar to films produced by major Hollywood studios like Disney or Universal Pictures. 

AAA games might attract gamers with movie-like storylines, high quality rendering, expansion packs and more. Because of this, AAA games are usually expected to sell more copies and produce more profit than games released by smaller studios.

Some of the most popular video games released in recent history include:

• Fortnite (Epic Games, multiplatform, 2017): A Battle Royale multiplayer game, Fortnite players face off against 100 other players across the world and fight until one remains.
• Minecraft (Mojang, multiplatform, 2011): An open-world sandbox multiplayer game where players design buildings, craft tools and structures, fight computer-controlled “mobs” and share their creations with friends.
• World of Warcraft (Blizzard Entertainment, Mac and PC, 2004): A massive multiplayer, role-playing game (MMORPG) in which players assume the role of a fantasy creature and complete quests with other players to level up and unlock new storylines. 
• Roblox (NYSE: RBLX): Is a massive gaming platform and a publicly-traded corporation that appeals to both kids and adults.

Best Online Brokers for Video Game Stocks

No matter if you’re shopping for video game stocks that you plan to keep in your portfolio for decades or you’re simply looking for hot stocks under $5, you’ll need a brokerage account. A brokerage account allows you to buy and sell stocks with the assistance of a broker, as traders cannot purchase stock directly.

Don’t have a brokerage account? Consider a few of our favorites below as you aim to access the gaming industry, investing in video game companies, gaming gear, your favorite video game franchises and more.

Features to Look for in a Video Game Stock

Not every video game company is equally as successful or profitable. Before you invest in a video game stock, look for these features.

• A positive earnings per share value: A stock’s earnings per share (EPS) value is calculated by dividing a company’s net income minus dividends by its total number of outstanding shares. A positive EPS value indicates that a company is currently profitable, while a negative value may indicate that its spending more money than it is bringing in through sales. You want to see potential for revenue growth, a rising market cap, a higher share price and a gaming experience that attracts the attention of the public.
• Investment in technology: Video game tech is expanding and advancing faster than ever before. As gamers’ expectations for game graphics and features rise, corporations producing video games should be heavily invested in cutting-edge tech. From 5G to new consoles to artificial and virtual reality, check how a corporation is using new tech in its game development to keep gamers engaged.
• Production of AAA games: Though AAA isn’t a formal video game classification, be sure to research game marketing and development before you invest. Investing in companies producing AAA games is recommended, as these games usually have much wider distribution than smaller productions. Popular studios in this arena include Electronic Arts, Zynga, Tencent, Ubisoft Entertainment and Rockstar.

Powering Up Your Portfolio With Gaming Stocks

Video game immersion is now more important than ever before — and more and more video game developers are investing in creating new technology to keep up.

If you decide to purchase video game stocks, remember to diversify your portfolio by investing in a variety of hardware production companies, gaming keyboards, gaming headsets, gaming laptops, gaming mice and other gear. Plus, game development studios and mobile companies can also help limit your risk.