The esports boom is already here.
There’s so much excitement, the market could be worth $1 billion this year, says Newzoo.
“The eSports audience will grow to 495.0 million globally in 2020. Esports Enthusiasts will account for 222.9 million of this number, up 25 million year on year, and will increase with a CAGR (2018-2023) of +11.3% to 295.4 million in 2023. Meanwhile, the number of global Occasional Viewers will hit 272.2 million in 2020, up from 2019’s 245.2 million. This number will grow with a CAGR of +9.6% to 351.1 million in 2023.”
By 2022, the market could be worth well over $2.96 billion, says Goldman Sachs. “That projection comes largely on the back of the massive growth potential the company sees in the eSports population,” notes eSports Observer.
And by 2024, the market could be worth up to $6.82 billion, says Grand View Research.
In short, esports stocks could offer monumental opportunity, and all as millions of people around the world compete in competitive, organized video gaming.
With further explosive growth likely, some of the top esports stocks to consider include:
Top Esports Stocks: Activision Blizzard (ATVI)
The first time I weighed in on Activision Blizzard, I noted, “With new consoles being released in 2020 along with the esports boom, I would buy ATVI stock and hold it for the long-term.”
That was on Nov. 15, 2019, as the ATVI stock traded at $52.40.
Nowadays, the stock is up to $81.11 and could easily run to $100 a share on the esports boom – especially with events like the Overwatch League and the Call of Duty League. Better, Activision already has a big, growing user base.
At the moment, the company’s MAU (monthly average users) count is up to 102 million. Blizzard’s MAU is up to 32 million, with King MAUs up to 273 million. As the company pushes for further growth in the esports business, the company can leverage its user base.
“Activision is well on its way to establishing itself as the ‘ESPN of esports,’ and it has likely just scratched the surface of the opportunity. Beyond its established efforts, the company has plenty of other popular titles that would work well as the basis of an esports league,” says Motley Fool contributor Luis Sanchez.
With plenty of momentum, I believe the ATVI stock could hit $100 before the year is out.
Electronic Arts Inc. (EA)
Electronic Arts has been incredibly explosive in 2020 so far.
In fact, since bottoming out in March 2020, the EA stock has run from a low of $85.69 to a recent high of $141.58. From here, I wouldn’t be shocked to see if closer to $160 this year on the heels of the console and esports boom.
The best part, according to Venture Beat contributor Dean Takahashi, is “[m]ore people are playing and forming grassroots esports leagues. EA said it wants to push esports into the mainstream by becoming the gateway to competitive gaming and esports fandom. EA and/or licensed EA partners operate an estimated 100 tournaments across its franchises annually and it is seeing an uptick in people playing.”
Going forward, Electronic Arts says it’ll execute more than 100 celebrity, athlete, and charity online eSports events.
In addition, EA and FIFA just announced plans for EA Sports FIFA 20 global eSports competitions.
“We’ve already seen amazing fan engagement with our competitive events over the past few months,” EA Sports FIFA Competitive Gaming Commissioner Brent Koning said. “Our partnership with the top football leagues have resulted in over 100 hours of TV broadcasts alone and now we’re looking forward to offering players and viewers even more great competitions to play and watch.”
HUYA Inc. (HUYA)
Another hot esports pick to consider is HUYA Inc., one of the top live game streaming platforms in China. Since bottoming out in March 2020, the stock has rocketed from a low of $11.78 to a recent high of $24.40. Near-term, it could see $40 a share on solid esports momentum.
With agreements with esports tournaments, event organizers, and major game publishers, HUYA has a steady supply of quality esports offerings on its platform. Not only is that great news for its existing user base, but it could attract many more users, too.
Better, “Since Tencent became our largest shareholder in April 2020, we have been strengthening our collaboration, especially in terms of our live streaming content and capabilities,” says CEO Rongjie Dong. “To better serve our users and broadcasters, we are working closely with Tencent across areas such as games, e-sports and AI technology, as well as developing new features, products and services.”
“With Tencent’s strong support and massive user community, we believe we are well positioned to strengthen our leadership in game live streaming and capture more opportunities across the gaming value chain. We see this cooperation as the start of a new journey for Huya, and we look forward to being an active participant in a dynamic and growing market.”
Ian Cooper, an InvestorPlace.com contributor, has been analyzing stocks and options for web-based advisories since 1999. As of this writing, Ian Cooper did not hold a position in any of the aforementioned securities.
