Five gaming stocks to keep an eye on as industry continues to expand

Highlights

  • Corsair Gaming, Inc. (NASDAQ: CRSR), the high-performance game gear provider, has a P/E ratio of 18.11.
  • Elys Game Technology (NASDAQ: ELYS), a sports betting and gaming service provider, has a market capitalization of US$109.3 million.
  • Activision Blizzard, (NASDAQ: ATVI), a video game publisher, has a P/E ratio of 24.66, and a dividend yield of 0.57%.

The gaming companies saw significant revenue growth in recent times, boosted by the stay-at-home trend during the pandemic. However, not all gaming companies experienced a favorable business situation. Some Chinese companies have been negatively impacted by the new government rules. Beijing seeks to restrict online playtime for children to three hours per week.

However, gaming stocks have been on investors’ radar as they make rapid strides. Here we explore five gaming stocks that may benefit from the robust potential of the gaming industry.

Corsair Gaming, Inc. (NASDAQ: CRSR)

The Fremont, California-based company provides high-performance gear for gamers, content creators, and streamers. The company has a market capitalization of US$2.7 billion, a P/E ratio of 18.11, and a forward P/E one year of 16.85.

In the June quarter of FY 2021, Corsair earned US$472.9 million in revenue compared to US$380.4 million in the same period of 2020. Its net income was US$27.75 million or US$0.28 per share diluted against US$22.60 million or US$0.26 per share diluted in the year-ago period.

Corsair’s gross profit was US$130.3 million and gross margin was 27.6% in the quarter.

The CRSR stock closed at US$28.31 on Aug 30, 2021.

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Elys Game Technology, Corp. (NASDAQ: ELYS)

Elys is a sports betting and i-Gaming service provider headquartered in Boca Raton, Florida. The company operates the betting software called Elys Game Board.

In the quarter ended June 30, 2021, its revenue was US$11.69 million compared to US$4.81 million in the same period a year ago. Elys booked a net loss of US$2.77 million or US$0.13 per share diluted against US$2.53 million or US$0.20 per share diluted in the June quarter of 2020.

Elys has a market capitalization of US$109.3 million. The stock closed at US$4.63 on Aug 30, 2021.

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Skillz Inc. (NYSE: SKLZ)

Skillz is a San Francisco, California-based mobile game development company. Its market capitalization is US$4.7 billion. Skillz earned revenue of US$89.49 million in the June quarter of 2021 compared to US$58.88 million in the previous year’s corresponding quarter.

The company booked a net loss of US$79.60 million or US$0.21 per share diluted compared to US$20.16 million or US$0.07 per share diluted in the June quarter of 2020. The liquidity reserves of the company were US$692.78 million at the end of the June quarter of 2021.

The stock closed at US$10.59 on Aug 30, 2021.

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Activision Blizzard, Inc. (NASDAQ: ATVI)

Activision Blizzard is a Santa Monica, California-based video games developer. The company has a market capitalization of US$64 billion, a P/E ratio of 24.66, a forward P/E one year of 23.38, and a dividend yield of 0.57%. Its annualized dividend is US$0.47.

The company reported revenue of US$2.3 billion for the June quarter, 2021, compared to US$1.9 billion in the same quarter the previous year.

The net income was US$876 million or US$1.12 per share diluted against US$580 million or US$0.75 per share diluted in the June quarter of the previous year. Its liquidity reserves were US$9,209 million as of June 30, 2021. The stock closed at US$81.12 on Aug 30.

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Take-Two Interactive Software, Inc. (NASDAQ: TTWO)

Take-Two Interactive is an independent developer, publisher, and marketer of video games based in New York. The gaming company has a market capitalization of US$18.79 billion, a P/E ratio of 28.74, and a forward P/E ratio one year of 47.92.

In the June quarter of 2021, the company’s revenue was US$813.3 million compared to US$831.3 million in the June quarter of 2020. The net income was US$152.26 million or US$1.30 per share diluted compared to US$88.51 million or US$0.77 per share diluted in the same quarter the previous year.

The cash and cash equivalents were US$1.4 billion at the June quarter-end.

The stock closed at US$158.14 on Aug 30, 2021.


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Bottom-line

Gaming stock prices have been declining this year though many companies have reported significant revenue and sales growth. Analysts expect the gaming industry to see fast-paced growth with improvement in the economy and the coronavirus situation.

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