The video game industry is involved in the development, marketing, and sale of video game hardware and software. Top companies include Electronic Arts Inc. (EA) and Nintendo Co. Ltd. (NTDOY). The video game industry has performed well during the COVID-19 pandemic as business shutdowns and social-distancing measures have limited peoples' entertainment options. Since video games can be used in the home, they have become a popular option for many consumers. Additionally, Microsoft Corp. (MSFT) and Sony Corp. (SNE) released new game consoles late in 2020, which sparked a massive surge in console sales.
Video game stocks, represented by the VanEck Vectors Video Gaming and eSports ETF (ESPO), have slightly outperformed the broader market. ESPO's total return was 44.1% over the past 12 months versus the Russell 1000's total return of 42.8%. These market performance numbers and all statistics in the tables below are as of June 15, 2021.
Here are the top 3 video game stocks with the best value, the fastest growth, and the most momentum.
These are the video game stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
|Best Value Video Game Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/E Ratio|
|The9 Ltd. ( NCTY)||18.60||0.3||0.5|
|Nintendo Co. Ltd. (NTDOY)||73.23||69.8||16.9|
|SciPlay Corp. ( SCPL)||17.11||0.4||19.2|
- The9 Ltd.: The9 is a China-based online game operator and developer. The company provides an online virtual community game. It also owns exclusive licenses to localize and operate additional multiplayer online role playing games. The9's Fun Box is a home entertainment set top box for online games to be played on a television set. The company announced in early June that it has agreed to acquire Montcrypto Ltd., a Canada-based, carbon-neutral cryptocurrency mining facilities company. Under the terms of the agreement, The9 plans to invest a total of CA$7.6 million ($6.2 million) in Montcrypto in two separate instalments to acquire a controlling stake in the company.
- Nintendo Co. Ltd.: Nintendo is a Japan-based multinational consumer electronics and video game company. It develops and manufactures portable and console game machines, as well as software, playing cards, and consumer electronics. Its game consoles include Nintendo Wii, Nintendo DS, and Nintendo 3DS.
- SciPlay Corp.: SciPlay is a developer and publisher of digital games for mobile and web platforms. The company offers casino games, such as Jackpot Party Casino and Hot Shot Casino, as well as casual and bingo games, such as MONOPOLY SLOTS and Bingo Showdown.
These are the top video game stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.
|Fastest Growing Video Game Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)||Revenue Growth (%)|
|Take-Two Interactive Software Inc. ( TTWO)||178.60||20.7||75.7||10.4|
|Enthusiast Gaming Holdings Inc. ( EGLX.TO)||CA$7.02||CA$0.8||N/A (see company description)||333.2|
|Activision Blizzard Inc. ( ATVI)||95.97||74.6||21.5||27.2|
- Take-Two Interactive Software Inc.: Take-Two Interactive Software is a developer, publisher, and marketer of interactive entertainment. Its products are designed for console systems, personal computers, smartphones, and tablets. It develops and publishes its games mainly through Rockstar Games, 2K, Private Division, Social Point, Playdots, and recently acquired Nordeus. Take-Two announced in early June that it had acquired Nordeus for as much as $378 million.
- Enthusiast Gaming Holdings Inc.: Enthusiast Gaming is a Canada-based video game and eSports company. It is focused on developing a social media platform for video game and eSports fans to connect worldwide. The company announced in mid-May that it has agreed to acquire Tabwire LLC, which owns TabStats, for $11 million. The acquisition provides Enthusiast Gaming with a technology and data platform that gives gamers the ability to view their game data in real-time. The transaction is expected to close by the end of the second quarter of 2021. Because the company reported a net loss in the most recent quarter, we cannot calculate an EPS growth rate for the table above.
- Activision Blizzard Inc.: Activision Blizzard develops, publishes, and distributes interactive entertainment content and services for video game consoles, personal computers, and mobile devices. Its major titles include the Call of Duty and World of Warcraft franchises.
These are the video game stocks that had the highest total return over the last 12 months.
|Video Game Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|Avid Technology Inc. ( AVID)||36.38||1.6||396.3|
|Enthusiast Gaming Holdings Inc. (EGLX.TO)||CA$7.02||CA$0.8||358.8|
|Score Media and Gaming Inc. ( SCR.TO)||CA$26.20||CA$1.3||235.9|
|VanEck Vectors Video Gaming and eSports ETF (ESPO)||N/A||N/A||44.1|
- Avid Technology Inc.: Avid Technology develops software and integrated solutions for video and audio content creation, management, and distribution. Its platform and set of creative software tools provide content creation solutions for the media and entertainment industry. The company announced in early May financial results for Q1 of its 2021 fiscal year (FY), the three-month period ended March 31, 2021. It reported net income of $4.4 million, a significant turnaround from a net loss of $5.9 million in the year-ago quarter. Revenue rose 9.2%.
- Enthusiast Gaming Holdings Inc.: See above for company description.
- Score Media and Gaming Inc.: Score Media and Gaming is a Canada-based digital media and sports betting company. It provides live scores, news, stats, and betting information on sports teams, leagues, and players. The company also creates and distributes digital content and offers a sports betting app.
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Enthusiast Gaming Holdings Inc. "Enthusiast Gaming Accelerates Launch of Gaming Social Network and Premium Subscription Offering with Acquisition of Tabwire." Accessed June 17, 2021.
Enthusiast Gaming Holdings Inc. "Enthusiast Gaming Reports First Quarter 2021 Financial Results." Accessed June 17, 2021.
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