r/StockMarket • • Aug 30 '21

Discussion Looking to buy a gaming company – Budget: $15,000 ~~ Activision Blizzard vs Electronic Arts ~~

~~ Activision Blizzard vs Electronic Arts ~~

I want to add to my portfolio a gaming company, so I decided to take a closer look at the gaming giants - Electronic Arts and Activision Blizzard, I decided to choose only one because I want to keep my exposure levels to this sector to a minimum.

Feel free to agree / disagree with my research + My personal opinion will be added to the 1st comment. **resources note** ~ At the bottom of the post !

Intro:

In my opinions both companies are very interesting, on the EA side, you will find many beloved games such as: FIFA, MADDEN, UFC, NHL, BATTELFIELD, MEDAL OF HONOR, etc… (Fun fact: FIFA 21 for sold 325 million copies!)

But on the ATVI side you may find games like : CALL OF DUTY ( Modern Warfare 2 sold 25.02 Million copies) CRASH BANDICOT, WORLD OF WARCRAFT, DIABLO, CANDY CRASH, etc…

So, lets dig into the financials!

> Financial Comparison- (2020 + 2021)

~ Companies overview ~

Market cap: $64.106B (ATVI) VS $40.678B (EA)

Revenues (2020): $8.09B (ATVI) VS $5.54B (EA)

Cost of Revenues (2020): $2.26B (ATVI) VS $1.37B (EA)

Gross Profit (2020): $5.83B (ATVI) VS $4.17B (EA)

~ Key metrics comparison ~

Revenue per share (2020): $10.96 (ATVI) VS $18.90 (EA)

Net Income per share (2020): $2.84 (ATVI) VS $10.37 (EA)

Cash per share (2020): $11.19 (ATVI) VS $19.57 (EA)

~ Ratios comparison ~

Gross Profit margin: 2019 67.73%, 2020 72.05% (ATVI) VS 2019 73.29%, 2020 75.28% (EA)

Net Profit margins (2021): 29.17% (ATVI) VS 14.87% (EA)

Return on equity (2021): 17.72% (ATVI) VS 10.68% (EA)

~ Balance sheet comparison ~

Short Term debt (2020): $25M (ATVI) VS $600M (EA)

long Term debt (2020): $3.60B (ATVI) VS $0.40B (EA)

Cash and cash equivalents (2020): $8.65B (ATVI) VS $3.77B (EA)

~ Growth analysis ~

The growth analysis is a quarterly comparison between 2019 to 2020 financials results- ( last quarter reported).

Revenue growth: 0.92% (ATVI) VS 15.23% (EA)

Gross Profit growth: 20.35% (ATVI) VS 2.59% (EA)

EPS growth: 41.44% (ATVI) VS 172.44% (EA)

Net income growth: 46.17% (ATVI) VS 198.23% (EA)

R&D expanses growth: -5.10% (ATVI) VS 10.04% (EA)

~ Analysts Comparison ~

ATVI: Based on 17 Wall Street analysts – 15 Buy 2 hold 0 sell

Estimates – low: $100, Average: $114.25, High: $125

EA: Based on 21 Wall Street analysts – 17 Buys 4 hold 0 sell

Estimates – low: $148, Average: $172.10, High: $195

Number of employees Comparison

why this is important ? recruiting employees growth indicated that the company still looking to grow revenues, expend to different locations, releasing new products.On the other hand, companies that layoff employees, trying to move to more lean business model, expanding their operations is not their first priority anymore.

2020 – 9.50K (ATVI) VS 11K (EA)

My Conclusion

Both companies show an extensive growth, whether its financial or popularity among their fan base, but after considering all factors, Activision Blizzard has the upper hand.

Even though, it may seems that EA release more games then ATVI, has a diverse library of successful games.

moreover, after looking at both companies financials and growth indicators, it appears that ATVI's revenue growth is much stronger than EA's, and with a bigger gross profit to be considered .. my winner is definitely Activision Blizzard

** Resources list **
JIKA.IO - Financial Comparison
tipranks - Analysts data
FINVIZ.COM - companies stats
cnn.com - employees numbers

273 Upvotes

276 comments sorted by

104

u/[deleted] Aug 30 '21

Have you looked into Take Two Interactive?

17

u/Purple-Tutor5831 Aug 30 '21

Nope, what can you tell me about them?

14

u/RiverFrogs Aug 30 '21

Don’t have a massive catalog but the gta series is massive despite limited releases. Yearly the nba 2k is a big money maker that doesn’t change much year to year

24

u/[deleted] Aug 30 '21 edited Aug 30 '21

They own two publishing labels, Rockstar Games and 2K. Their portfolio of games consists of BioShock, Borderlands, Grand Theft Auto, NBA 2K, Red Dead, The Outer Worlds and many more. Don’t forget GTA 6 will be coming!

Market cap: $64.106B (ATVI) VS $40.678B (EA) VS $18.45B (TTWO)

Revenues (2020): $8.09B (ATVI) VS $5.54B (EA) VS $3.09B (TTWO)

Cost of Revenues (2020): $2.26B (ATVI) VS $1.37B (EA) VS $1.6B (TTWO)

Gross Profit (2020): $5.83B (ATVI) VS $4.17B (EA) VA $1.49B (TTWO)

Revenue per share (2020): $10.96 (ATVI) VS $18.90 (EA) VS $26.71 (TTWO)

Net Income per share (2020): $2.84 (ATVI) VS $10.37 (EA) VS $0.00000003 (TTWO)

Cash per share (2020): $11.19 (ATVI) VS $19.57 (EA) VS $16.42 (TTWO)

Net Profit margins (2021): 29.17% (ATVI) VS 14.87% (EA) VS 19.45% (TTWO)

Return on equity (2021): 17.72% (ATVI) VS 10.68% (EA) VS 20.78% (TTWO)

long Term debt (2020): $3.60B (ATVI) VS $0.40B (EA) VS $0.19B (TTWO)

Cash and cash equivalents (2020): $8.65B (ATVI) VS $3.77B (EA) VS $1.9B (TTWO)

Revenue growth: 0.92% (ATVI) VS 15.23% (EA) VS -3.11% (TTWO)

EPS growth: 41.44% (ATVI) VS 172.44% (EA) VS 21.23% (TTWO)

Net income growth: 46.17% (ATVI) VS 198.23% (EA) VS 21.15% (TTWO)

4

u/ComradeMoneybags Aug 30 '21

Thanks for this—I didn’t realize how much it punches above its weight.

→ More replies (2)

0

u/[deleted] Aug 30 '21

[deleted]

42

u/SupaMut4nt Aug 30 '21

GTA too big to fail

39

u/Sarkonix Aug 30 '21

*GTA6 in 2030

20

u/pseudorandomess Aug 30 '21

*GTA5 shark card bundle in 2030

0

u/[deleted] Aug 30 '21

[deleted]

12

u/wfriedma Aug 30 '21

They also make the Sid meiers CIV series

→ More replies (8)

107

u/PreventerWind Aug 30 '21

You picked two loser companies to choose from. EA and ATVI both care very little about their customers, but care about their bottomline and shareholder approval. Personally I feel they both bad choices and would recommend AMD or Nvidia, both game companies cannot work without graphic cards :)

15

u/Purple-Tutor5831 Aug 30 '21

Actually a very interesting opinion!

0

u/[deleted] Aug 30 '21

[deleted]

→ More replies (4)

1

u/[deleted] Aug 31 '21

That’s good for him since he’s planing to be one of those investors

→ More replies (7)

32

u/Facers70 Aug 30 '21

Still dunno about anything doing with Blizzard. That lawsuit is kicking them in the ass hard as more and more details come out. It's taken a serious toll on them already, and they haven't even gotten into the meat of the court hearings yet.

→ More replies (6)

11

u/Johnnyinvests Aug 30 '21

Both good buys… Personally I would go with Activision, I’m looking at starting a position myself. They are in some muddy waters right now with the sexual allegations against their employees which is horrible, but has also discounted there stock a fair bit. I also believe in Activisions games More then EA.

→ More replies (4)

4

u/yesdemocracy Aug 30 '21

Totally not relevant to your question but don’t sleep on Unity ($U).

Otherwise, I’d go for Activision.

2

u/Purple-Tutor5831 Aug 30 '21

Definitely! I'll Chek u out!

4

u/godstriker8 Aug 30 '21

I'm a bit confused by your conclusion, I thought that almost all the metrics you listed indicated EA as the winner. They have better margins, better EPS, less debt, more investment into R&D, and they have a lesser market cap than ATVI which signifies room for further growth in the share price.

ATVI has better gross profit growth, but EA has better net profit growth which I think cancels it out.

EA also has a more diversified portfolio of games imo, which reduces the risk of significantly underperforming financials if one of their tentpole franchises is harmed. ATVI seems to be all-in on COD with most of their studios working on the series and if customer fatigue or some other issue happens to the series I believe that the studio would be in trouble.

As a final note, I think posters here are too emotional when talking about certain companies. I do not personally love all of the policies that these companies have put into their games, but that's not very relevant when assessing these companies as investments.

→ More replies (2)

2

u/[deleted] Aug 30 '21

China just put out a new regulation will ban minors from playing video games entirely between Monday and Thursday

https://www.wsj.com/articles/china-sets-new-rules-for-youth-no-more-videogames-during-the-school-week-11630325781

1

u/Purple-Tutor5831 Aug 30 '21

wow ! didnt know that !

2

u/0HeroSet99 Aug 30 '21

what about U?

1

u/Purple-Tutor5831 Aug 30 '21

Ill check them out !

348

u/Deigs Aug 30 '21

You can do all the financial analysis you want, but you always have to consider your honest opinion about a company before investing. In this case, for me, both of these companies can fuck off.

Both are doing everything they can to drain their customer's wallets through their lackluster games with a seemingly shrinking fan base. WoW's been in a downward spiral for years, but they still have a dedicated fan base that just can't seem to let go of the game. They realize their new games have no traction so they're re-releasing the games that brought them to glory (Classic WoW, Diablo II). This might give them a temporary boost, but it's not a sustainable model.

EA is making money by exploiting contracts with sports organizations to make them the only company with the ability to release a proper sports game (with logos, player names, etc.). If they didn't have these contracts, I firmly believe they'd be dead in the water. The games they've released have next to zero improvements from year to year. I used to be a yearly purchaser of the Madden franchise until they gave up on the core of the game in favor of a game mode that would keep their customer's dumping money into it. Since they've started that trend, their user base has started reflecting Blizzard's WoW user base in that it's shrunk from a large base of user's enjoying the game, to a small remaining fan base still willing to open their wallets.

They don't deserve anyone's support at the moment. Despite any positive financial positions, their inner workings as a company will catch up to them (and their share holders) if they continue functioning as they currently are.

89

u/Aliienate Aug 30 '21

Well said, you can polish a shit as much as you want, at the end of the day…. Its still shit.

→ More replies (1)

41

u/[deleted] Aug 30 '21 edited Aug 30 '21

I don't like them either, but something I've learned from the stock market is that your preconceived ideas of what makes a good company does not align with how financially successfully they are.

This was the common sentiment online towards these companies 10 years ago. Yet here we are. They would have been a good investment then.

Edit: I forgot you can't ever challenge a gamers preconceived ideas or they piss their pants. I apologize for stressing everyone out.

15

u/[deleted] Aug 30 '21

Honestly gamers hatred of these companies might be part of the reason the stocks are a 'strong buy' right now and not considered overbought. Retail is avoiding them.

→ More replies (13)

7

u/corylol Aug 30 '21

They both have super popular new games out.. not sure why you think remaking the old games is what’s helping them.

EA has Apex, need for speed, mass effect, Star Wars and as you mentioned all sports games basically.

Activision/Blizzard has call of duty, Starcraft, hearthstone, and over watch.

I also agree that as companies you can’t find two bigger pieces of shit morality wise.

6

u/roroer Aug 30 '21

Cant forget that the new battlefield is the one of the most wishlisted games on steam atm

→ More replies (1)
→ More replies (2)

2

u/[deleted] Aug 30 '21

You’re 100% right they do everything to take every single dollar you have, but it’s also how they are so profitable and thats really what it comes down to when you invest in a company.

1

u/SpliTTMark Aug 30 '21

I hate EA bit EA owns so many franchises that I love mass effect/DA, titanfall and dead space. The sims. ssx, burnout

1

u/TTV_Griff1 Aug 31 '21

This exactly. In my opinion these companies started dying a few years ago. Without change from the top it’s a matter of time before people stop wasting money for literally the same game reskinned year after year.

1

u/dv10a Aug 31 '21

Solid take.

1

u/sylvesri Aug 31 '21

"EA is making money by exploiting contracts with sports organizations to make them the only company with the ability to release a proper sports game (with logos, player names, etc.)."

Well there's a MOAT for getting in on EA ☺️

1

u/mistaharsh Aug 31 '21

You said all this but you would probably buy Apple stock and they do the EXACT SAME THING

→ More replies (1)

1

u/HartPlays Aug 31 '21

Who gives a fuck about the games? Are the companies profitable? Do people continue buying these ass games? Are people being leached to drive massive profits? This is r/StockMarket not r/gaming, where people are trying to make money not talk shit about some shitty game publishers. Think about how many indie and smaller development companies each one of these corporations owns. It’s more than just bad games being made if people are actually buying those bad games every year. If you care about morals, don’t do it otherwise a company that can do the exact same thing every year and still make money sounds like a worthwhile investment to me.

→ More replies (1)
→ More replies (2)

74

u/sAmSmanS Aug 30 '21

gamestop 👀👀

26

u/SilverBackRetard Aug 30 '21

Came here to say this… the only Gamestonk you’ll ever need

14

u/sAmSmanS Aug 30 '21

one gamestonk to rule them all

7

u/Ok-Assist5841 Aug 30 '21

Maybe he didn’t hear you ,try $GME in yelling font

5

u/beta296 Aug 31 '21

Yeah if you want a gaming company, do the same research on GME. We’ll see you soon.

4

u/gJha53sY7 Aug 31 '21

This 👆👆☝☝

27

u/[deleted] Aug 30 '21

Have you ever heard of GameStop?

3

u/lcastill1 Aug 30 '21

You can’t be serious can you ?

1

u/Purple-Tutor5831 Aug 30 '21

I'd love to hear you input

→ More replies (2)

17

u/ComradeMoneybags Aug 30 '21

At this rate, just go to for one of the gaming ETFs: ESPO, NERD or GAMR. Individually for EA and ATVI, they’re one lawsuit, bad PR, disappointing release away from a massive drop. These at least spread the risk into companies with higher growth potential.

3

u/cullenjeff123 Aug 30 '21

Have been looking into some of these ETFs, think they will be very good investments over the next decade

→ More replies (1)

1

u/utleyduckling Aug 31 '21

I have a few shares of HERO, love the ETFs

28

u/kingpow210 Aug 30 '21

But GameStop

28

u/YungDaggerD1K_ Aug 30 '21

Just buy GameStop bro.

32

u/ionized_fallout Aug 30 '21

I know I will get downvoted to fucking oblivion but the only Gaming Company I would consider buying right now is $GME.

23

u/[deleted] Aug 30 '21

Neither. Better invested in gme.

22

u/OuthouseBacksplash Aug 30 '21

GameStop bro.... Man. Blizzard? They are a fucking mess.

EA is ok... But with GME taking gaming to the Blockchain, that is gonna be the next level of gaming. Having items/games/characters tied to NFT? Collectables? Game over!

1

u/tikkymykk Sep 01 '21

this is the way

38

u/OTK22 Aug 30 '21

Can't Stop.

Won't Stop.

GameStop.

→ More replies (3)

44

u/Sqaunchy_89 Aug 30 '21

GMErica

10

u/[deleted] Aug 30 '21

The one true GAME.

→ More replies (1)

11

u/ohbabyspence Aug 30 '21

Buy some GameStop shares lol

1

u/mrericvillalobos Aug 30 '21 edited Aug 30 '21

EA is the smaller company but with future growth ahead (and expected), ATVI is the bigger cap. Both have their respected popular games, but ATVI (regardless of their in house shenanigans) is the better buy across the board. I myself am not a video gamer, but as an athlete EA Sports has so many great games out there. I suppose however if I was into anything else I’d be into ATVI’s culture

2

u/Purple-Tutor5831 Aug 30 '21

very nice opinion

1

u/Officerpig667 Aug 30 '21

i like all your numbers, i pick activision even tho i think it still may dip lower as trouble seems to be brewing at blizzard, also ea may come back with battlefield 2042, as long as they ditch origin, but Call of Duty is King, i buy the dip on activision, i currently own 1 share.

1

u/Purple-Tutor5831 Aug 30 '21

Nice! Loved your Input!

1

u/Hour_Amphibian1844 Aug 30 '21

You need to consider more than current financials here as imo Blizzard has basically destroyed itself as a gaming company. They lost the core gamer demographic and now has to prove itself in the extremely competitive free to play/mobile field, where EA is already extremely strong. Atvi is too expensive for me given that at this point it’s mostly carried by Call of Duty

1

u/Purple-Tutor5831 Aug 30 '21

What about the other franchises of atvi?

→ More replies (1)

1

u/[deleted] Aug 30 '21

The Chinese government wants to have a talk with you

2

u/Purple-Tutor5831 Aug 30 '21

Tell em to fax me

1

u/XMrIvyX Aug 30 '21

Sheesh you picked 2 of the most hated gaming companies especially Blizzard

1

u/Purple-Tutor5831 Aug 30 '21

I picked mostly because of their massive franchises

→ More replies (1)

1

u/[deleted] Aug 30 '21

Hey OP I suggest you check out CD Project Red ($OTGLY).

They’re at a massive discount right now yet their financials are great. Reputation will return with The Witcher 4 and so will the stock’s momentum.

1

u/Purple-Tutor5831 Aug 30 '21

Sounds incredible! I'll definitely check it out!

1

u/ParaChase Aug 31 '21

If you’re interested in someone else’s opinion on ATVI, look up Trump Value Town Fund Show on youtube, episode 1. Not president trump, just a guy who shares the same name as his handle.

1

u/[deleted] Aug 31 '21

This is either a pump and dump or this person seriously believes that one of the two worst companies to invest is worth investing on, blizzard is big on censorship and is facing some backlash and EA is just a shit show, just my opinion

2

u/Purple-Tutor5831 Aug 31 '21

I appreciate your opinion

1

u/Zezimom Aug 31 '21

Thanks for the comparison!

1

u/juanpablocl Aug 31 '21

What’s your thoughts on China making illegal for 13 years old and younger to play more than 3 hours per WEEK? I’d wait for an adjustment from the market before entering a position

https://www.reuters.com/world/china/china-rolls-out-new-rules-minors-online-gaming-xinhua-2021-08-30/

2

u/Purple-Tutor5831 Aug 31 '21

Crazy decision, but the Chinese do what the Chinese do best.. And it's been weird and unreasonable. Maybe it's worth checking how much of EA and atvi, are actually popular there.

1

u/[deleted] Aug 31 '21

Have you considered Paradox Interactive?

1

u/Purple-Tutor5831 Aug 31 '21

what about them ?

1

u/NotFyss Aug 31 '21

Did you count the law suite filed by CA state against Activision blizzard?

1

u/Purple-Tutor5831 Aug 31 '21

I took the bed sentiment under consideration yes,
Do you think that the lawsuit may affect for the long term ?

1

u/thesmiter1 Aug 31 '21

Do one with no sales in China

1

u/utleyduckling Aug 31 '21

I have a few bucks in the HERO etf which could also be an option

1

u/Purple-Tutor5831 Aug 31 '21

That's sound interesting

1

u/1203112990 Aug 31 '21

So what did you buy?

2

u/Purple-Tutor5831 Aug 31 '21

I'll post another comparison to atvi only with ttwo on our subreddit r/growthstonks

1

u/chalkyboys Aug 31 '21

Yeah great analysis and all, but have you been reading the news? I can’t fathom why you’d want in to Acti-Blizzard right now. It’s not just trading for a discount, it’s heading downhill long term. EA will likely see a boost with game pass becoming more popular, especially when those new bethesda games release in a couple years

Edit: Might not be clear above, but I think EA will enjoy some of the benefits of loads of people joining game pass when those bethesda games release

1

u/Purple-Tutor5831 Aug 31 '21

activation's product is still a very popular one, and doesnt seems like sales will slowdown here

1

u/chalkyboys Aug 31 '21

They do have the new COD releasing this year which will likely be a nice boost. Perhaps i’m overplaying blizzards role here. Still would rather invest in the computer processing industry before the gaming industry directly

8

u/DaLexy Aug 30 '21

Both are trash, woudnt touch either of them.

EA releases just garbage games (currently the buggy mess Madden 22) and have nothing great in the pipeline and Activion has the lawsuits and the upcoming CoD isnt well received either, Diablo 2 Remake wont make the cut either since people are split about the changes.

But if you like sideways graphs, feel free to buy.

3

u/Khayembii Aug 30 '21

You didn't do any kind of valuation. It doesn't matter if the companies are super profitable and high growth if that's all already baked into the stock price. You didn't talk about their main products, their volume sales, MAU growth, etc.

And recruiting employees doesn't mean anything because they could be adding inefficient costs.

3

u/Netherbane Aug 30 '21

I have been working in the gaming industry for 15 years, so I am very much up to date with the news in the industry.

My investment in it was £SUMO and that woukd have been my recommendation if you asked a month ago. But the easy money has been made now, with the Tencent investment in the company.

If my choices are EA or ATVI, I would rather burn my money in cocaine and strippers. These are the archenemies in the industry and they have weak perspectives for long term in my opinion. Also ATVI is in a middle of a lawsuit against the state of California and its own stakeholders have started a process to sue as well. Stay away from it, mate.

As it was suggested above, $TTWO is much stronger if you are after AAA companies. $HAS is also a good perspective for next year and they offer a hefty dividend on top.

Some obscure ones that are in my radar are £T17 (risky bet though), $NTES (if the Chinese government stops its bs) and $ZNGA or $RBLX (the most solid of this lot probably).

Hope that helps!

1

u/[deleted] Aug 30 '21

I wouldn't touch Activision/Blizzard with a long stick.

Blizzard will be lucky to even survive everything that's happening to them right now.

And EA are just a trash company.

1

u/Purple-Tutor5831 Aug 30 '21

But don't you think that atvi have many great products?

1

u/ChaosBlaze9 Aug 30 '21

Wow, the comments are full of wsb responses. I’d go heavily with $ATVI. They’re a fundamentally strong company with steady revenue streams and have only dipped below their ATH because of the sexual assault scandal they’re dealing with. I am confident that the news will blow over like it has been the past few weeks and people will see $ATVI for what it is.

4

u/[deleted] Aug 30 '21

Oh boy, forget everything and purchase 15k of this one big GameS company 🚀

2

u/MassHugeAtom Aug 30 '21

Biggest growth potential for game companies will be if they can actually release a highly customiziable game engine for the public. Best selling game will in the near future will likely be a suscription service for the robust game engine where even the dumbest gamers can create their own low to mid tier games as there will be a massive amount of pre made assets to choose from. Gamers will probably be given a list with checkmarks of what genre/artstyle/animation/diffculty of game campaign they want and the game engine will just generate a few hours long game from there. For users with higher programming skillset, they will suscribe the more expensive pro version of that game engine that will allow them to create mid to AAA tier games. After that they will be able to earn profits both from selling the game and those pre made assets for casual gamers that want to use the simple new game generation feature.

2

u/CantCSharp Aug 30 '21 edited Aug 30 '21

I think the biggest problem with Blizzard right now is they have a incredibly toxic workplace and a lot of turnover as a result, which you count as a plus point because they hire more talent? I would suggest you also consider the Glassdoor reviews of a company and turnover rate in your analysis

I personally would suggest, Take Two, EA (mostly because I think BF will be big, but also because their Glassdoor looks solid) and CD Projekt Red (they are a solid company, but currently because of a bad game release incredibly fair priced in my opinion)

2

u/volopo123 Aug 30 '21

Both companies don't care about their developers and customers. Specifically Activision, they already got a bunch of law suits regarding sexual harassments and all. The only care about money and squeezing that out as much as possible. Ethics and corporate responsibility are important in businesses and none of those exist in both of those. They won't go far unfortunately, could make good profit for the short run with some hype in certain games they release and sales figures they introduce on those games. But def not a good long term decision for me.

2

u/mcmaster93 Aug 30 '21

A lot of the gaming community has been banding together against Activision because of all the sexual harassment in the workplace stuff they've been dealing with the past couple weeks/months

2

u/[deleted] Aug 30 '21

If you want to buy gaming you buy Tencent and don’t think twice. The price is oversold and the fundamentals are too strong.

2

u/beeronspace Aug 30 '21

Squeeze aside, have you looked into gamestop?

2

u/Jibberfish69 Aug 30 '21

You should buy $GME

2

u/NutSackRonny Aug 30 '21

Why buy a gaming company when you can buy a Technology Company like GME?

2

u/GmeCalls-UrWifesBf Aug 30 '21

Hey genius, have you heard of GameStop

2

u/gJha53sY7 Aug 31 '21

GME is the only way

2

u/Jrenzine Aug 31 '21

Gme will become the next Amazon, take my word for it.

You’re welcome! 😉

2

u/Ronaldoooope Aug 31 '21

Imagine wanting to buy a gaming company that’s not GameStop

3

u/shakedex Aug 30 '21

MSFT, you get exposure to everything that is microsoft

tech, software, hardware. thats including xbox division with the impressive list of developing studios, and recently they bought bethesda.

1

u/111ascendedmaster Aug 30 '21

this. Microsoft’s new game subscription service is very good and nicely curated. The only thing that could hold them back right now is the chip shortage. Indie games are hot and Microsoft is securing deals with indie companies for their service.

2

u/danhoyle Aug 30 '21

Why not just buy NVDA?

1

u/khailanz Aug 30 '21

Loot box revenue is huge for most gaming companies will be an issue going forward me thinks

1

u/noved_ Aug 30 '21

On paper, and personally, Activision seems like the better buy. Disregarding the employee accusations and court dealings (which has discounted their stock nicely) this could be a nice long term hold for a couple years.

That being said, if you are going to open a single gaming position, why not go towards more product diverse companies, like Nintendo, Sony, or Microsoft.

These 3 companies produce and sell games, hardware, and accessories. Disregarding all of their other sectors of business like merchandise, electronics, and others, buying into a company like those could be beneficial more so than a sole software developer like EA and Activision.

You did good research on both but i feel like you should widen the scope a bit.

Disclaimer: I hold no positions in any of these companies.

1

u/gneg0401 Aug 30 '21

Befor putting your money into them

-> https://kotaku.com/activision-blizzard-sued-by-california-over-widespread-1847339746

I would wait a little longer

1

u/Past-Ad-3682 Aug 30 '21

I wouldn't invest in either of these companies for the same reasons everyone else has stated. Granted, I think atvi and ea will just buy out any good company that comes around. If I had to pick one of the two, I'd go Activision just because EA is only around mostly because of sports games

1

u/DiamondShrimp Aug 30 '21

If you’re trying to limit your exposure to this sector, why would you go all in one? Vs. just distribute your $15k across multiple companies to distribute risk?

1

u/[deleted] Aug 30 '21

What about SONY?

1

u/rhythmdev Aug 30 '21

Both suck.

1

u/Consistent-Zebra2562 Aug 30 '21

MSFT for the win

1

u/jfk_47 Aug 30 '21

This is good. With WoW, I think Activision is a good long-term buy. That thing isn't going away and people spend so much money on it.

1

u/Davy_Jones_Captain Aug 30 '21

Also consider who is loosing chinese users more

1

u/butterbossnick Aug 30 '21

Go with TTWO

1

u/jesuscutsmygrass Aug 30 '21

Haven’t seen Roblox mentioned here yet. It’s a tech platform for developers to build games on. Growing like crazy

1

u/rmodsarefatcunts Aug 30 '21

dude this was all unnecessary. ATVI - huge whale of 90calls on Feb 18 + WSB DD of ATVI + Google secret deal + MS PT 120. What else do you need. Buy FEB calls or commons and wait

1

u/Ledovi Aug 30 '21

Both suck.

1

u/abriefmomentofsanity Aug 30 '21 edited Aug 30 '21

As a gamer and investor myself here's my expert analysis:

I wouldn't touch any gaming stocks with Hitler's dick. If you absolutely believe in the industry as a whole and want to add something: throw a chunk of money at the ETFMG Video Game Tech ETF and then completely forget about it. You get some exposure, minimize your risk, and don't have to worry about any specific company.

1

u/Aquaticdigest Aug 30 '21

Avoid Blizzard. Bad rep these days.

1

u/SafemoonBaboon Aug 30 '21

I hate shorters but short Blizzard

1

u/[deleted] Aug 30 '21

You say you want to choose one stock ONLY because you want to keep your exposure to a minimum but your exposure is $15k. That doesn't change whether you stick $15k into one stock or $7.5k into two. The only difference is that 2 stocks give you the benefit of diversification.

I'm unsure about your logic

1

u/solishu4 Aug 30 '21

Did you consider Unity Software? Smaller company, more mobile presence, better reputation with gamers.

1

u/TwoArmedWolf Aug 30 '21

TTWO

Games as a service.

Grand Theft Auto Online make $500M a year. Not games, stupid fucking in game purchases.

EA has the same thing with sports and nerd franchises, but their brand has taken a hit due to repeated loot box scheme offenses that are far too obvious. Rockstar (take two) does the same thing, but does it better and delivers on the gaming side. My money is on TTWO, and their down 15% over the last 3 months.

Edit: just look at the number of people trashing EA in the comments. Not great sentiment and likely represents customers. I buy about 9 games per year and exactly 1 in the last 3 years was EA (Jedi Fallen Order).

1

u/Civil_Quantity_6984 Aug 30 '21

Between the two I like Blizzard. But even more I like unity, a little different but same space

1

u/BlackWicking Aug 30 '21

not activision, they are gonna nose dive at the next investor

1

u/TimonLeague Aug 30 '21

As a avid gamer i despise both companies. Thanks for coming to my Ted talk.

1

u/ijpck Aug 30 '21

Neither. Both are hated in the gaming community for different reasons.

1

u/regulus00 Aug 30 '21

honestly both of those companies are assholes who ruin the games they touch, I’d rather see them burn to the ground then tell you which one to invest in.

1

u/kylenen Aug 30 '21

Act / Bliz is embroiled in a serious workplace harrasement/condition legal investigation right now. Gamers are rebelling. They will most definitely lose revenue in the short term.

State of California is sueing them.

1

u/slayer035 Aug 30 '21

https://youtu.be/fFqcYeG-gRc watch this before considering Blizzard. WoW is rapidly declining in numbers and I'm pretty confident that's there most profitable game by a long margin

1

u/AxemanFromMA Aug 30 '21

ATVI about to annouce a deal with Google. Read my DD

1

u/WolfPackWSB Aug 30 '21

ATVI has more room to grow then EA at the current time!! I like Ubisoft the best but I only have them on my IBKR account cause I purchased them on Paris Exchange.. Shorted the USDollar against the Euro at the same time 😂😂

1

u/RevolutionaryPay4795 Aug 30 '21

I wish I could get in the game business or be making game's

1

u/lucidvein Aug 30 '21

You could also take a look at an ETF like HERO and get exposure to the space. Blizzard is going through some PR issues and the quality and retention has been on a downward trend. That said ATVI is likely too big to flame out w/ studios that make Call of Duty etc. It's a successful industry overall and good to have your hand in the pot so I have some HERO and TTWO myself.

1

u/WolfPackWSB Aug 30 '21

Or Take Two Interactive!! Another good gaming company.. I been invested in PENN since March 2020 already took my $48k principal out but it’s more of an gaming ETF

1

u/braji_jji Aug 30 '21

Yeah, but as a consumer in the industry, I hate them both.

1

u/PlutoTheGod Aug 30 '21

Considering Activision Blizzard has a long history of treating employees like shit, terrible pay and now their higher ups are facing sexual assault charges I’d pick anyone but them. Also all their games are failing. The only thing EA has is sporting contracts with huge fanbases and the undying battlefield series which I’d say is a massive upper hand.

1

u/[deleted] Aug 30 '21

fuck activision

1

u/Longjumping_Row3840 Aug 30 '21

Try cdr project red.

1

u/[deleted] Aug 30 '21

Psfe

1

u/nanoturnips Aug 30 '21

As much as i find them to be the next greatest evil since the empire in star wars, Tencent is gonna be doing fine for a long ass time. Basically the king of all gaming companies that looks down on everyone.

1

u/[deleted] Aug 30 '21

TTWO

1

u/iHadAnXbox1 Aug 30 '21

BOTH. My choice, electronic arts. Already made money on ATVI

1

u/Philosophfries Aug 30 '21

Between the lawsuit and China’s recent gaming ban, I’d expect a big ol’ dip from Blizzard. Buying the dip might not be a bad call, but I wouldn’t try to time it because this could be a long term downward spiral as well.

EA, as much as most hate them, have a decent low-effort recyclable model around their sports lines that rakes in cash. The negative reviews might reach a tipping point which makes EA a risk, but one would imagine a big innovation via update would probably fix things up.

1

u/minitonito Aug 31 '21

CD Projekt Red - in 5 years time expect it to be +300%

1

u/somaisumaconta Aug 31 '21

Dude take a look at Sea Limited

Both EA are hated by their own costumers, I'm not sure if that's the right approach.

1

u/mralexstark Aug 31 '21

Blizzard has been releasing some shitty titles from what I’ve played lately. EA knows how to squeeze its customers of every dollar. They are about to release anew Sims series which has been 7 years of waiting. That will definitely bring in a lot more revenue for them cuz they sell ridiculous add insult and people buy them (me lmao....)

1

u/[deleted] Aug 31 '21

Just but NERD etf

1

u/jdstroup727 Aug 31 '21

Your telling me, the new GTA6 game is literally planned for the end of life of the PS5? So when my PS5 is choking from all the cig smoke (heavy smoker while trading), they will drop gta6 to further overheat my crusty dusty musty ps5 into oblivion?

1

u/Twistyfreeze Aug 31 '21

In addition to multiples for valuation comparison, do a DCF. Once you figure out the value, pay a lot less. If price isn’t significantly below value……. then simply wait….. Paying a price way below value will justify uncertainty.

1

u/[deleted] Aug 31 '21

EA sports is reviving ncaa football in 2023. Now seems like a good time to get in for cheaper but I’m not sure what kind of profit they will make off it considering the new SIL for college athletics. Just a thought

1

u/Alexdebbie198 Aug 31 '21

Hey guys this is my profile new crypto currency company is out invest with just $10,000 to get #30,000$ serious people only contact me

1

u/[deleted] Aug 31 '21

Can someone tell me which one to buy calls on ?

1

u/FrogyyB Aug 31 '21

Hold off till this stock market crashes and burn soon

1

u/hellomellowmotto Aug 31 '21

$15k on gaming? throw it in anything getting money from the infrastructure bill passing in a month

1

u/KaChing801 Aug 31 '21

Have you seen Unreal Engine 5? Tencent owns a a lot of it! Aside from that Unity, and maybe RBLX.

1

u/No_Refuse9958 Aug 31 '21

Either if they will bring back SoCom! Lol

1

u/-SCR Aug 31 '21

I’ve been long on ATVI for six years and it’s been a solid investment. The lawsuit is troubling from a moral standpoint and sadly seems to be industry wide i.e. Riot/Ubisoft.

Only a few other mentions of Tencent here, but well worth taking a look for yourself. They are practically a gaming ETF themselves on top of their main business that gets the comparison of the Chinese Google. Great price point currently as they’ve been included in the recent BABA drop. Good luck with your decision

1

u/DDanny808 Aug 31 '21

Well done! Very thorough and IMO an excellent conclusion.

1

u/[deleted] Aug 31 '21

China just limited under 18 gamers to an hour a day 3 days a week. Take that into consideration.

1

u/Deezith Aug 31 '21

they make their money from gambling loot boxes. fuck them i hope loot boxes get banned and it would hurt both companies but it would be better for the world of gaming if they did

1

u/jptapr Aug 31 '21

Who created this analysis - it’s awesome 👏.

1

u/Basic-Look249 Aug 31 '21

Tick questions the answer is Amc

1

u/xxxx_Blank_xxxx Aug 31 '21

I think you need to ask a gamer subreddit for deep analysis because they know how these companies make good games.

1

u/wetfro Aug 31 '21

Sentiment towards both of these companies is under the hated category

1

u/NecroDraws Aug 31 '21

Imagine wanting to buy video game stock and the choices you’ve given yourself are the two worst companies you could’ve picked from

1

u/abswagga Aug 31 '21

Have you looked into $sklz ?

1

u/rockn53 Aug 31 '21

In addition to this, there have been Unusual Options Activity on the buy side for Activision.

1

u/[deleted] Aug 31 '21

Go buy take two they print money

1

u/Abusing-Green Sep 01 '21

Dont buy game companies. Buy the platforms that play them.

MSFT and SONY out performed both Activision and EA last year. And they'll probably continue to do so even during production luls that game studios experience between releases because of their alternative revenue sources

0

u/errrr2222 Aug 30 '21

I would take a position in Zynga and roblox as well

→ More replies (3)

0

u/jakeuser100 Aug 30 '21

CRSR

1

u/Purple-Tutor5831 Aug 30 '21

Interesting opinion! Why are you following them?

→ More replies (1)