Video games might be one of the best ways to avoid feed doomscrolling and just chill. They have always been a great way to distract from reality, and in recent years this effect has become stronger than ever. So, one could say that it seems to be a great time for game makers to show off in the stock market but, there are some reasons why it’s not exactly like this – in 2022 the shares didn’t show particularly impressive results. Let’s see if we can find out how it happened, and what video games stocks might have new high scores in 2023.
Below, there is the chart showing the stocks of game makers from all over the world. From the top downward – Japanese Konami, Bandai Namco and Nintendo, American Activision Blizzard and Take-Two Interactive, French Ubisoft. For the record, if you want to make a list of stocks, you can use the Stock Screener – it helps to sort shares by the set-up criteria.
It might be surprising, but Japanese stocks haven’t enjoyed profit over the last 12 months. It’s surprising because most of the stock markets have been falling due to the economic and geopolitical situation of the world.
First, the Covid pandemic pulled a thread: causing supply disruptions, slowdown in game production and deficit of service parts for next-generation consoles. Later they postponed the releases of AAA-projects, and we were treated to a decrease in sales in the PC-market. Plus, we can’t forget (sadly) about the overall state of the world economy when all markets are falling down. You can almost hear the Titanic soundtrack playing in the background.
So that doesn’t sound great, but hold off on deleting your investment apps. Many experts consider that some video game stocks are likely to hike in the next 12 months. We put together the arguments for why the industry may make up for lost time in 2023 and the list of stocks that can show growth according to analysts’ consensus forecasts.
In 2023, the situation with demand-supply mismatch for new-generation consoles will probably become better. It will give more gamers an opportunity to buy the Xbox Series X and PlayStation 5 and subsequently increase game-sales.
The other positive news came from China – an enormously large part of the market the industry can carve out. The country that prevented teenagers from playing video games for more than 3 hours per week, gained the upper hand over the game addiction among teens. However, the officials added that restrictions are likely to be moderated. One more problem is a lack of new video games in the Chinese market because of the regulator’s policies – all games must be licensed. This process has been frozen, but experts expect that it might be resumed in 2023.
At the same time, the world finds itself in crisis. We’ve heard a lot about the risk of the recession – and it means that people will have less money to spend. Above all, it will affect how much money they will spend on entertainment. No doubt, games belong to this category. And it’s not the most expensive type of entertainment – you can just sit at home and play games (they can even be free), and spend a huge amount of time completing huge AAA-projects. So, maybe video games are a good choice during the crisis.
In addition, this industry is becoming bigger and bigger every year. Therefore, there are lucrative long-term investments, even beyond the 1-year prospect. But in our list, you can find stocks which have the most exciting opportunities in the next 12 months.
Ubisoft, a French publisher owning brands like Assassin’s Creed, Far Cry and Just Dance. The average forecast is +59% in the next 12 months.
Konami, a big Japanese publisher and game maker. The average forecast is +29% in the next 12 months.
Bandai Namco, a Japanese video game, toy and anime maker. The average forecast is +27% in the next 12 months.
Take-Two Interactive, a video game holding projects like GTA, Red Dead, Max Payne and many others. The average forecast is +25% in the next 12 months.
Activision Blizzard, a company that may become a part of Microsoft. The average forecast is +24% in the next 12 months.
Nintendo, the creator of Mario, Zelda and Pokémon. The average forecast is +23% in the next 12 months.
Remember that analysts can and sometimes do get their predictions wrong. It is always best to carry out your own research before making any investment decisions. This is rule #1 all traders should follow.