Three winning plays among gaming stocks

These companies are well positioned to benefit from the video game market's long-term growth potential.

Vikram Barhat 8 August, 2016 | 5:00PM

The mobile game Pokémon Go created a worldwide sensation and caused the Japanese videogame maker Nintendo's stock price to double within seven days of its release in the United States last month. It has also shone a spotlight on the fast-growing video game industry that is pushing all the right buttons with consumers globally.

The worldwide video game market is growing exponentially. The industry is going digital, smartphones and tablets use is exploding, and an increasing number of people are buying and playing games routinely, generating huge revenue for gaming firms. In the United States, 63% of households have at least one person who plays video games regularly, which resulted in a staggering US$23.5 billion spent on games -- including content, hardware and accessories -- in 2015, according to the Entertainment Software Association, which represents companies that publish computer and video games.

PwC's annual Global Entertainment and Media Outlook projected the U.S. video games market to grow at 3.6% annually to reach US$20.28 billion by 2020. Globally, the video games market is projected to hit US$99.6 billion in revenue in 2016, up 8.5% from 2015, eventually reaching US$118.6 billion in 2019, forecasted Newzoo, a Dutch company that provides data on the digital games market.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Activision Blizzard Inc70.15 USD0.21
Electronic Arts Inc117.38 USD0.63
Take-Two Interactive Software Inc134.52 USD3.32

About Author

Vikram Barhat

Vikram Barhat  Vikram Barhat is a freelance writer.