Best Video Game Stocks List to Buy for Growth in 2022
After surging during the pandemic, video game stocks look to be setting up for another run. Demand for entertainment continues growing. And video games are leading the way. The top video game stocks list continues expanding as companies look to grab a piece of the future of entertainment.
Video games became the go-to option with half of humanity locked down during Covid. And not just for kids. Adults too. Companies are drawing interest as new tech makes gaming more immersive.
Moreover, the headwinds propelled video game sales to a record $56.9B in 2020, showing 27% growth YOY. But demand continues creeping up. As gaming communities grow in popularity, the industry is seeing higher engagement.
In fact, gaming is now the most popular home entertainment choice. The pandemic helped the video game industry surpass movies and North American sports together.
Video game revenue grew another 1.4% in 2021, showing strong momentum. Don’t expect the trend to change anytime soon either. To grab your share of the future of entertainment, check out the top video game stocks list below.
Top Video Game Stocks List
As video games continue growing in popularity, companies are noticing. The rise in demand over the past few years leaves video game makers with strong cash positions. As a result, the funds can help fuel future growth.
The top video games stocks list includes companies in all aspects of the industry. Both hardware devices and gaming are expanding.
Although supply chain issues are limiting companies’ ability to ramp sales, demand is strong. In fact, some will argue the pandemic permanently boosted the industry.
With this in mind, here is the best video game stocks list to buy for growth this year.
No. 5 Nintendo (OTCMKTS: NTDOY)
- EPS Growth (YOY): -10%
- Revenue Growth (YOY): -3%
Although Nintendo saw game sales decline slightly compared to last quarter, device sales remain strong. That said, Animal Crossing: New Horizon saw sales peak last year.
Meanwhile, Nintendo Switch sales reached over 100M units. As a result, total net sales reached their third-highest level ever.
At the same time, rising material costs are cutting into margins. The operating profit margin slipped 1.4% due to lower profits and higher marketing expenses. With this in mind, Nintendo expects shortages and rising costs to continue this year.
Nintendo is still in a strong position with some of the most popular franchises. Mario Cart, Animal Crossing, Super Smash Bros, and Pokémon, to name a few.
The company is in a position to take advantage of the growing market between video games and Nintendo devices.
No. 4 Take-Two (NASDAQ: TTWO)
- EPS Growth (YOY): -22%
- Revenue Growth (YOY): 3%
Take-Two is the mastermind behind hit franchises like Grand Theft Auto (GTA) and NBA2K. The company is aggressively targeting the mobile market.
For example, Take-Two now has four of the top 200 mobile games. Moreover, the company buying Zynga should help accelerate the transition. The move allows TTWO to take a bigger step into mobile gaming with hit titles like Farmville and Words With Friends.
Furthermore, TTWO is moving to stabilize revenue. Rather than having hit game releases drive revenue, the company has a different approach. Instead, Take-Two looks to boost subscription revenue.
By offering subscriptions through Xbox, PlayStation, and Apple Arcade, TTWO has more reliable income. As a result, it can plan to invest back in the business, stimulating long-term growth.
No. 3 Electronic Arts (NASDAQ: EA)
- EPS Growth (YOY): 8%
- Revenue Growth (YOY): 24%
EA is another top video game stock to own, with many popular titles such as Madden and FIFA. But EA has an advantage.
For one thing, the company has a more reliable income stream with hit titles coming out every year. Games like Madden and FIFA get an annual refresh with new teams and graphics.
Furthermore, the company is successfully transitioning to mobile. FIFA Mobile is a big hit, with new players soaring 80% in the fourth quarter. Not only that, but APEX Legends is also one of the most popular online games.
Multi-player games online like FIFA and APEX are driving massive user growth. Users are recruiting friends and family to boost their teams. As a result, EA is achieving record player growth, engagement, and bookings.
Keep reading and discover the two companies leading the best video games stocks list to buy this year.
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Is Now the Time to Invest in the Top Video Game Stocks List
Despite massive industry growth, video game stocks are down this year. Many of them sold off with tech stocks and have yet to recover. But the video game industry continues gaining steam.
With new segments like Esports and digital communities driving growth, video games are bigger than ever. The video game market is expected to continue expanding at a CAGR of 12.9% until 2030.
The companies on the video games stocks list above are pushing the industry to new heights. Every year, video games get more and more realistic. As a result, users from every age group are participating. With this in mind, gaming is driving record profits.
The future is bright for gaming companies. But many stocks are down this year with fears of a recession heightening and inflation surging. That said, this could be a chance for investors to buy the companies creating the future of entertainment.
