Video game sales have been increasing consistently since their creation. This makes eSports stocks a great option. The simplest games can become an instant success, from Call of Duty to Minecraft, Flappy Bird, Candy Crush, and FarmVille. A lot has changed since the first consoles and the rise of Mario, Donkey Kong, and Final Fantasy. Any game can attract millions of users. Video game developers need to think of the next best thing constantly.
Technology is also a big part of this industry. The best graphics and online experience are essential for successful games. However, the industry isn’t stopping there. Earlier this summer, the first video game lifestyle company went public. It has big plans for this industry.
Furthermore, just like for sports, it is now possible to gamble on the performance of your favorite eSports teams and players. Many companies specialize in this field. Let’s take a look at the various players in the eSports industry.
Table of Contents
- Video Game Stocks
- eSports Betting Stocks
- eSports ETFs
Video Game Stocks
Since the creation of video games, competition has been fierce. Who hasn’t sat down for numerous hours to play Super Smash Brothers, Mario Kart, or FIFA with their friends? Let’s look at the most successful video game developers and eSports stocks.
eSports Stocks: Activision Blizzard (NASDAQ: ATVI)
First on the eSports stocks list is Activision Blizzard, the largest independent video game developer. This company is responsible for popular games such as Overwatch, World of Warcraft, Call of Duty, Diablo, and Candy Crush.
However, it might not remain for much longer on this list. Earlier this year, in January, Microsoft (NASDAQ: MSFT) offered to purchase Activision Blizzard at $95 per share with a $68.7B valuation. The deal was approved in October. Activision could see a significant increase in its stock price if it does go through.
What would Microsoft do with Activision? It would certainly upgrade its VR department and add video games to its list. Activision ranks among the best on esports streaming platforms. Microsoft could create its platform.
There are tons of possibilities. Let’s not forget about the metaverse. This partnership could reshape metaverse video games. An increasing amount of gamers are looking to upgrade their online VR experience. Activision is a very promising stock.
Take-Two Interactive (NASDAQ: TTWO)
Next on the list is Take-Two Interactive. It is best known for its Grand Theft Auto (GTA) games and NBA 2k. The latter is the most popular online sports game in the US and China. That isn’t a feat to forget. How long has it been since these games have been released? Decades. Are they still popular yes? Will consumers buy future new and improved versions? Most certainly.
In May 2022, Take-Two acquired fellow competitor Zynga for $12.7B. Zynga is a dominant force in developing mobile games and social games. It is also present in 175 countries. This acquisition effectively diversifies Take-Two’s business model.
However, Take-Two must remain a leader in the eSports stocks community. Recycling old games is good, but originality is becoming a more important factor.
eSports Stocks: Electronic Arts (NASDAQ: EA)
We continue our eSports stocks list with Electronic Arts, the second-largest independent video game developer. EA is responsible for FIFA, Madden, Need for Speed, Battlefield, Half-Life, The Sims and more.
Thanks to its franchise games, EA can create tournaments daily. FIFA is known in every single country and is present in countless households.
Nintendo (OTCMKTS: NTDOY)
Japanese company Nintendo has an impressive list of video games. They’re probably the most popular of the eSports stocks. They are among the most successful, at least from my childhood. It includes every single Mario game, Zelda, Pokemon Animal Crossing, Minecraft, Kirby, Fire Emblem, Tetris, and much much more.
However, the stock trades on the OTC markets, making it less available for US investors. This doesn’t make the stock any less attractive. Nintendo is responsible for some of the oldest consoles: NES, SNES, N64, Game Cube, Game Boy, and the Nintendo Switch.
The last is one of the most popular worldwide as we speak. Its most famous eSports game must be Super Smash Brothers. It attracts millions of competitors to its tournaments.
eSports Stocks: Roblox Corp (NYSE: RBLX)
If they remain active on the platform, there can only be growth. Developers can also make a name for themselves and credit the platform if their games are successful.
eSports Betting Stocks
The gambling industry isn’t legal in every country or every state. There are a lot of hurdles to running a successful and legal gambling company. Now, imagine the challenges of adding eSports stocks to the mix.
There are a few companies, but I will only name two. For now, they are the only ones attracting enough business.
Draft Kings (NASDAQ: DKNG)
Draft Kings is a relatively recent company. It was only founded in 2012. In its early days, Draft Kings focused on sports betting. It is legal in the US except in Washington, Hawaii, Oregon, Nevada, Idaho, and Montana. The company also operates in Canada (except Ontario), Austria, Germany, Ireland, Malta, and the UK.
How do you participate in eSports betting on the platform? There are daily contests for LOL, CS: GO. ENAS, RL, and COD. You can pick the winning team and members, and there are different categories to pick from.
The platform is also very user-friendly both on mobile and on the computer. DKNG is on our eSports stocks list because of its popularity.
Flutter Entertainment (OTCMKTS: PDYPY)
Flutter Entertainment is an Irish company specializing in online gambling. The reason it is included on this list is simple. In December 2020, Flutter purchased a 95% stake in FanDuel for $4.1B. FanDuel was the first platform to accept eSports betting in the US.
In Washington and Maryland, FanDuel is only available at retail locations. However, the mobile version is legal in Wyoming, Colorado, Arizona, Louisiana, Iowa, Illinois, Tennesse, Indiana, Michigan, and both Virginias, Pennsylvania, Connecticut, New York, and New Jersey. Using it outside of the US requires a VPN.
Fan Duel is slightly more popular than Draft Kings, which could impact your eSports stocks. The platform operates its eSports division very similarly to Draft Kings. You can bet on individual matches or tournaments.
In July 2022, FaZe Clan (NASDAQ: FAZE) went public via SPAC and became another of the ePosts stocks. It was valued at $725M. What exactly is FaZe Clan? They are a professional eSports and entertainment company with players worldwide who are active across multiple video games.
The company began with three players and Call of Duty trick shots. Now, they have rosters in multiple online games. Snoop Dogg is even sitting on their Board of Directors. They are video game influencers. Their fanbase counts over 500 million users. FaZe Clan has partnerships with multiple brands and influential athletes around the world.
Many investors do not believe the company will continue to grow, and their success will FaDe with time. For the moment, they are growing and are attracting a lot of international success. However, betting on individuals playing an online game seems odd for the stock market.
VanEck Video Gaming and eSports ETF (NASDAQ: ESPO): VanEck’s ETF comprises various companies from the video game industry. From chipmakers to developers, there is something for everyone. There is a total of 25 securities in the ETF. The top 5 holdings include NVIDIA, AMD, Activision Blizzard, Roblox, and Tencent. It is well-diversified with a mix of tech and entertainment stocks worldwide.
Roundhill BITKRAFT Esports & Digital Entmt ETF (NYSEARCA: NERD): Roundhill’s portfolio distribution differs greatly from VanEck’s. The fund concentrates on much smaller players. There is a much higher risk. The top 5 holdings include Activision Blizzard, Corsair Gaming, Douyu Intl, Krafton Inc, and Huya Inc. Don’t be surprised at their eSports stocks performance in the last 12 months.
eSports Stocks Conclusion
To conclude, the eSports stocks sector has a variety of investment opportunities. There are developers, media companies, gambling platforms, and lifestyle brands. We haven’t touched on chip makers in this article, but they are a huge player in this industry.
Without them, none of this would be possible. In any case, the video game industry has a lot of growth left. Online sports aren’t going anywhere. If we add the virtual reality component to them, we look for even more growth and success.