2 Top-Rated Video Game Stocks To Power Your Portfolio

The video game industry has been one of the major beneficiaries of the COVID-19 pandemic. Revenues for many companies and platforms in the sector have increased over the last few quarters as gaming has become one of the key  entertainment outlets for people forced to stay at home.

According to Mordor Intelligence, the global gaming market is expected to grow at a CAGR of 10.5% over the next six years to hit  $295.63 billion in sales by 2026.

With increasing usage of smartphones and consoles, we think the stocks of  Activision Blizzard, Inc. (ATVI - Get Rating) and Take-Two Interactive Software, Inc. (TTWO - Get Rating) should grow significantly in the near future.

ATVI – The COVID-19-fostered remote lifestyle has bolstered the demand for virtual entertainment globally. With new strains of virus leading to the imposition of renewed lockdowns, along with a continued deepening of the remote work and play culture, we believe gaming stocks Activision Blizzard (ATVI) and Take-Two Interactive Software (TTWO) have plenty of upside.

Activision Blizzard, Inc. (ATVI - Get Rating)

Based in Santa Monica, CA, ATVI is a leading interactive entertainment company that develops and distributes content suitable for video gaming consoles, personal computers (PC), and mobile devices through retail and digital channels. The company’s primary franchises include Call of Duty, Crash Bandicoot, World of Warcraft, Diablo, StarCraft, Candy Crush, Bubble Witch, and Farm Heroes.

In  December, ATVI’s World of Warcraft: Shadowlands became the fastest-selling PC game of all time, selling more than 3.7 million units globally on its  first day. ATVI’s iconic Call of Duty series has set a new franchise record by surpassing more than  $3 billion in net bookings over the last 12 months, with key performance metrics across engagement and premium game sales at all-time highs.

ATVI has largely benefited from its dominant market position and growing global user base. The company’s net revenues have increased 21.5% year-over-year to $2.41 billion in the fourth quarter ended December 31, 2020. Its non-GAAP EPS has risen 22.6% from the year-ago value to $0.76, while its net bookings have grown 12.5% over the same period to $3.05 billion. Its overall Monthly Active Users (MAUs) were 397 million, slightly higher than the prior quarter.

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