Top 5 Stocks of the Gaming Industry
2022 shook the stock market from the very beginning, following the news about huge contracts in the gaming industry. On 10 January 2022, Take-Two Interactive Software – a leading game publisher – announced the acquisition of Zynga – a social game developer – for $12.7 billion.
One week later, it was reported that Microsoft would buy Activision Blizzard in a deal worth almost $70 billion. To keep up with competitors, Sony quickly arranged for the purchase of another representative of the gaming sector, Bungie. The deal, worth $3.6 billion, was announced on 31 January 2022.
Experts believe that these deals might have a positive impact on the whole gaming industry. Today, we'll tell you about the Top 5 gaming industry stocks: Engine Gaming and Media, SciPlay, Sea, Roblox, and Electronic Arts.
All of the above are trading on the NYSE and NASDAQ, and cost over $2 per share, with an average trading volume over the last trading session being more than 500,000 shares. The game developers described in the deals mentioned above were not considered when making the Top 5 list.
Engine Gaming and Media (formerly Engine Media Holdings) was established in 2011. Its head office is in Toronto, Canada. The company's major focus is on electronic sports, news streaming and data analysis, video gaming, online content monetisation, digital marketing, and advertising.
Engine Gaming and Media includes companies such as WinView Games, Eden Games, UMG Games, Frankly Media, Stream Hatchet, and Sideqik. As of this writing, the corporation's market capitalisation was $47.65 million.
The shares of Engine Gaming and Media Inc. (NASDAQ:GAME) responded to the news about the deal between Take-Two Interactive Software and Zynga with a 16.18% increase, up to $3.16. In the last trading week from 31 January to 4 February 2022, the share price leaped up 15.2%.
The company was founded in 2009. The headquarters are in Singapore. In 2017, Sea Limited went public on the NYSE with the biggest IPO ever conducted on American exchanges by a company from south-eastern Asia.
Sea Limited owns a popular e-commerce platform – Shopee, an online game developer – Garena, and a digital payments and financial services provider –SeaMoney. The company's market capitalisation is $87.73 billion.
An agreement between Take-Two and Zynga made the Sea Limited (NYSE:SE) shares leap up 5.75%, to $197.86, while a Sony-Bungie deal made them rise 10.02%, up to $150.31. From 31 January to 4 February 2022, the stock from the Singapore company increased 11.2%.
This week, Sea Limited shares continue regaining lost positions.
SG Social Games Corporation was registered in 1997 and changed its name to SciPlay Corporation in 2019. The head office is in Las Vegas, Nevada.
SciPlay develops and sells interactive and digital games for mobile apps and web-based platforms. Many of the company's games involve casinos and slot machines. Its market capitalisation is $1.65 billion.
Amid the news that Bungie will become a part of Sony Interactive Entertainment, the shares of SciPlay Corporation added 8.04%, reaching $12.5. In the past week, the stock leaped up 10.1%.
The company was founded in 2004 with headquarters in San Mateo, California. Roblox market capitalisation is estimated at $36.5 billion. The company's major product is an online entertainment platform.
The platform offers 3D games and virtual worlds. Users can create their own 3D simulations with the help of the platform's set of tools. As of October 2021, the average monthly number of active users was 226 million, with over 50% of them being young people under 16.
The shares of Roblox Corporation (NYSE:RBLX) have been rising significantly since 31 January 2022, affected by the news about a Sony-Bungie deal, which made the stock leap up 13.2% to $65.86 per share.
Last week, the shares demonstrated a 5.1% growth, which was followed by a correction.
Of all the above-mentioned companies, Electronic Arts is the only one with a long history: the corporation was established in 1982. Its head office is in Redwood City, California.
Electronic Arts develops, publishes, and sells video games for smartphones, tablets, PCs, and gaming consoles. The company's audience exceeds 450 million registered gamers from all over the world. EA's market capitalisation is $38.6 billion. The deals we described earlier had no impact on the shares of Electronic Arts Inc. (NASDAQ:EA).
From 31 January to 4 February 2022, the share price has seen a rise of 5%. As for the period since the beginning of 2022, EA's share price has remained fairly flat with growth barely exceeding 3%.
A fast-growing video gaming market
According to the report from Motionpictures.org, NewZoo, IFPI, and Media Post, which was published on the Engine Gaming and Media website, consumer spending on video games in 2020 was $159.3 billion. By 2023, the market is expected to exceed $200 billion.
The total number of gamers on the planet is estimated at 2.7 billion people. As for electronic sports, the global audience is over 50 million viewers, while eSport prizes are some of the biggest in the world.
Recent deals between Take-Two Interactive Software and Zynga, Microsoft and Activision Blizzard, and Sony and Bungie speed up the development of the gaming industry. Today we've discussed five companies from this sector that can be interesting for investors: Engine Gaming and Media, SciPlay, Sea, Roblox, and Electronic Arts.
This material and the information contained therein are for informational purposes only and should in no way be construed as providing investment advice for the purposes of the Investment Companies Act 87 (I) 2017 of the Republic of Cyprus, or any other form of personal advice or recommendation relating to certain types of transactions in certain types of financial instruments.