3 stocks to watch as the esports trend gains momentum

Electronic sports, the short form of electronic sports, which involves competitive and organized video games as a spectator sport, have grown in scale and popularity over the past decade. Through eSports events, game companies organize tournaments and allow spectators to watch professional players compete in a virtual environment.

Although esports is currently only a small part of the huge video game industry, it is growing exponentially. The audience for eSports and online games is already very large. The current environment of social distancing brought on by the COVID-19 pandemic has led to increased engagement and investment in the industry. Thus, industry players like Electronic arts EA, Activision Blizzard ATVI and Take-Two Interactive TTWO should win.

Growing eSports market

The industry has seen increasing demand since last year, as video games and online game streaming were a major source of entertainment for millions of people locked indoors amid the COVID-19 pandemic in Classes.

According to data compiled by Esports earnings, approximately $ 193 million has been awarded in 3,988 eSports tournaments during the year to date. That is compared to the $ 124 million given away as prizes in 2020.

Over the past decade, the number of professional esports gamers has grown to 20,469 in 2021, from 3,844 in 2011, according to data recorded by the Esports Earnings tracking website. The total prize money has increased exponentially to around $ 193 million, up from $ 11 million in 2011.

According to the Germany-based market and consumer data compiler, Statistical, the size of the global eSports market grew to $ 1.28 billion in 2021, from $ 0.97 billion in 2020. It is expected to reach $ 2.89 billion by 2025. The size of the global audience is increased to 474 million in 2021 from 435.9 million in 2020 and is expected to reach 577.2 million by 2025.

Investors can tap into this booming market by taking the following actions.

Electronic Arts: This global interactive entertainment software company Zacks Rank # 2 (Buy) offers online games, content and services for consoles, personal computers, cell phones and tablets connected to the Internet. You can see The full list of Zacks # 1 Rank (Strong Buy) stocks today here.

In an effort to move into the eSports market, Electronic Arts acquired leading mobile game developer and publisher Glu Mobile earlier this year. The acquisition is expected to have contributed to the growth of EA’s mobile business, leveraging its network of 100 million monthly active players in mobile, and creating a market-leading portfolio of more than 15 best live services in several fast growing genres.

The company is also focused on improving player and spectator engagement by making its tournaments accessible to all players. Electronic Arts’ Madden and FIFA were his biggest franchise games. According to Statista, the company owns 3.8% market share in the eSports space.

Electronic Arts Inc. Awards and EPS Surprise

Electronic Arts Inc. price-eps-surprise | Electronic Arts Inc.

Activision Blizzard: It is the world’s most successful stand-alone interactive entertainment company with a 21.9% global market share in the eSports category, according to Statista. The stock has a Zacks Rank # 3 (Hold).

Activision Blizzard has aggressively pushed into the eSports space by focusing on building highly engaged communities of gamers and audiences. His Call of Duty, Monitoring, and StarCraft gaming franchises are among the best competitive titles in league tournaments.

Activision Blizzard took advantage of the switch to digital download format. The company’s policy of updating games throughout the year has increased visibility and revenue stability. The game developer, who heads the professional esports league, has also signed sponsorship deals with automaker Toyota Motor Corporation, wireless service provider T-Mobile US and IT companies HP Inc. and Intel company INTC.

Activision Blizzard, Inc Price and EPS Surprise

Activision Blizzard, Inc Price and EPS Surprise

Activision Blizzard, Inc price-eps-surprise | Quote from Activision Blizzard, Inc

Take-Two Interactive: This company Zacks Rank # 3 is a leading developer, publisher and marketer of interactive entertainment to consumers around the world. The company used one of its most popular NBA 2K basketball to launch its first esports league, which was a huge success.

The blockbuster of the video game developer Grand Theft Auto The series has enormous potential to attract massive players and spectators for the eSports tournament. According to data compiled by Statista, the company has a 1.9% market share in the eSports space.

TakeTwo Interactive Software, Inc. Price and EPS Surprise

TakeTwo Interactive Software, Inc. Price and EPS Surprise

TakeTwo Interactive Software, Inc. price-eps-surprise | Quote from TakeTwo Interactive Software, Inc.

Zacks Top 10 stocks for 2022

In addition to the investment ideas discussed above, would you like to know our top 10 picks for all of 2022?

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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