The stock market has fallen a great deal in 2020. Video-game stocks have not. The rationale for that is pretty simple. With consumers cooped up in their homes thanks to the novel coronavirus pandemic, they are spending more time (and money) on video games. Electronic Arts (NASDAQ:EA) stock is benefiting from this trend. Year-to-date, EA stock is up 8%.

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I see this rally of EA stock continuing for the rest of 2020 and over the next few years. There are five main reasons for my bullishness:

1. Video-game sales globally have and will continue to rise at a steady double-digit-percentage clip, supported by a broader shift by consumers to digital products.
2. Thanks to its strong content portfolio, EA will continue to hold sizable market share in the non-cyclical-growth video-game market for the foreseeable future.
3. Video-game sales just logged their best month in 12 years, and huge catalysts on the horizon indicate that this robust momentum will persist for the rest of 2020.
4.  eSports, which is still in the first inning of explosive growth, can boost EA’s results meaningfully.
5. According to my numbers, EA stock will be fairly valued until it reaches about $125 per share.

All in all, then, EA stock is still a buy at this point, ahead of its fiscal fourth-quarter earnings which are due to be reported on May 5.

The Steady Growth of Video Games

According to research firm Newzoo, the global video games market has grown at a 13% compounded annual growth rate (CAGR) since 2015, mostly because interactions among consumers are being increasingly digitized.

This trend won’t slow up anytime soon. The novel coronavirus pandemic will only further push consumers into interacting more through digital devices. Another positive catalyst for this trend will be technological improvements such as 5G, which will help improve the quality of interactive video games.

Meanwhile, as consumers spend more time playing video games over the next decade, they will also spend more money on video games. That means they will make more in-game purchases and buy more upgrades. Further, video-game makers will have more opportunities to sell advertising.

Given all these trends, I see multiple drivers pushing the growth of the video game market to a CAGR of 8%-plus into 2025.

Stable Market Share

EA’s share of the global video-game space has held steady between 3% and 5% over the past few years. Over the next few years, I see EA’s market share continuing to stabilize, with opportunities for expansion.

The stability will be driven by EA’s robust content portfolio. FIFA and Madden are among two of the most played sports video-game franchises ever. Sims has a huge and committed fan base. The company’s various Star Wars games have mostly been big hits. Battlefield and Anthem are also quite popular with gamers.

The demand for these franchises won’t drop anytime soon. So, over the next few years, EA will launch new games in all of those franchises. Each of those updates will generate meaningful sales, leading to stable market share for the company.

The opportunity for expansion, meanwhile, comes from EA’s journey into the free-to-play, Battle Royale realm with Apex: Legends. This game has been a huge success, and if the company can build on its early success to sustain popularity in the Battle Royale market, then EA could easily see its share of the global video games market rise through 2025.

EA will, for the foreseeable future, remain a large, important player in this market.

Robust Market Momentum

Thanks to the coronavirus pandemic, consumers are playing video games more than ever right now, and the video-game sector in March consequently logged its best month of sales since 2008. According to the NPD Group, industry sales rose 35% in March to $1.6 billion.

Of course, this huge bump won’t persist. It’s a one-time phenomenon. Over the next few months, virus fears will fade, the economy will gradually re-open, and video-game sales will start to taper off.

But video-game sales won’t drop much. The outlook for the video-game market until the end of the year is quite promising.

Consumers will likely remain fearful of the pandemic — and therefore remain inside playing a lot of video games — until summer. So video-game sales should remain robust in April, May, and maybe even June. Then they will probably fall in July, August, and September, before re-accelerating in the last few months of the year amid the widespread proliferation of 5G technology and new console launches.

Overall, then, the video-game market should deliver strong results in 2020, both during and after the coronavirus pandemic.

eSports Will Be a Big Catalyst

One of the biggest growth catalysts in the video-game market is eSports, whose revenues are expected to rise by more than 60% over the next three years amid a surge in viewership and advertising revenue.

EA is attractively positioned in this high-growth market. The company’s competitive games could easily spur the creation of hugely successful eSports leagues. Think Madden, FIFA, and Battlefront.

So EA can turn into a big, important player in the burgeoning eSports market. That, in turn, would provide a meaningful lift to the company’s revenue and profit growth over the next few years.

Attractively Valued

EA stock is attractively valued relative to the company’s long-term profit growth potential.

I think EA’s top line will jump 7%-plus annually through 2025, with margin drivers from higher-margin in-game content and advertising sales, as well as increasing profitability as its revenue rises. I see the company generating earnings per share of about $8 by 2025.

This stock historically trades at 23 times analysts’ average forward earnings estimate. Based on that multiple and a 10% annual discount rate, $8 in 2025 earnings per share implies a fair 2020 price target for EA stock of over $125.

The shares trade around $115 today. Thus, the shares still can rise meaningfully through  the end of the year.

The Bottom Line on EA Stock

Investors will benefit from having exposure to the video-game industry in 2020 and over the next few years. In that industry, EA stock is one of three strong investment choices, alongside Activision (NASDAQ:ATVI) and Take-Two (NASDAQ:TTWO). An equally weighted portfolio of those three gaming stocks will perform strongly in 2020 and into 2025.