Since the inception of video games, players have always competed. That competition has gone mainstream over the last few decades. Competitive video gaming, also known as esports, is now a billion-dollar industry. 

A key contributor to this growth was COVID-19. As people spent more time at home and traditional sports were put on hold, esports filled the gap, attracting new fans and more players. The World Economic Forum spoke of the “huge growth in playing time and sales” during the pandemic. 

Now, video games have gone from being a simple pastime into a professional sport, with players competing in huge tournaments and earning big money from sponsors.

In other words, esports is now a fully-fledged industry, and investors are paying attention. If you want to cash in, it’s important to know which companies are at the center of the action. 

Here are some of the best esports stocks to consider buying this month.

Tencent (TCEHY)

Tencent (OTCMKTS:TCEHY) is a Chinese multinational holding company that occasionally features in the list of the biggest companies in the world by market valuation. 

It’s mostly known outside China as the company behind WeChat — the East Asian country’s equivalent of Facebook. Tencent has interests across several services, including music, cloud computing and fintech. It’s currently the biggest video game publisher worldwide, and it owns stakes in popular esports titles and organizes esports tournaments.

Tencent’s share price has rallied 21% this year. That’s expected given its highly encouraging earnings this past quarter. For instance, revenues were up 6% year-on-year (YoY), while gross profit rose 23%. Meanwhile, operating profit grew 30% YoY, with non-IFRS profit surging 54%.

Also, its 62% jump YoY in adjusted net profit is the fastest such increase for the company for the same quarter since March 2021, per LSEG data and as reported by CNBC. Tencent is definitely one of the best esports stocks to consider this August.

Sea Limited (SE)

Sea Limited (NYSE:SE) shares are currently exchanging hands at about $60, which is a jump of 60% so far this year. June, during which they traded at an average of $70, was the strongest month for the company. Investors who got in at the turn of the year saw about a 75% bump in their portfolio during that period. 

Sea is based in Singapore and has three business segments: digital entertainment (Gardens, which is an operator of esports), e-commerce (Shopee) and fintech (SeaMoney).

The company’s strong momentum this year is in spite of last quarter’s mixed results. That makes it compelling as one of the best esports stocks this season. While it netted positives, including a 22.8% increase YoY on GAAP revenue and a 9.7% jump in gross profit, it bled $23.0 million in net income and $12.3 million in cash and cash equivalents.

It’s clear that investors are banking instead on the company’s potentially lucrative business segments and its bullish projections of “a clear roadmap for profitable growth.” 

HUYA (HUYA)

HUYA (NYSE:HUYA) is a company that supports live-streaming video games. It works with e-sports event organizers, game developers and publishers to showcase live esports content across gameplay broadcasts, esports tournaments and other game-related shows.

Thanks to its encouraging price pattern over the last year, it’s among the best stocks to buy this August. HUYA shares have gained 30% over that period, including 14% this year alone. 

And from certain indications, such as growth in its user base and financials, HUYA stock will only climb higher as we go into the rest of the year. 

The firm saw its number of paying users hit 4.4 million in the last quarter. Financial highlights included a 5.2% uptick in net revenue and a 14.7% increase in gross margin. It also shaved off 17.8% in operating expenses compared to the same period a year prior.

On the date of publication, Hope Mutie did not have (either directly or indirectly) any positions in the stocks mentioned in this article. The opinions expressed in this article are those of the writer, subject to InvestorPlace.com’s Publishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.