The gaming and gambling sectors have undergone several changes in recent years due to various technological advancements and their increased popularity. This popularity and innovation have driven significant growth in businesses like video game studios, online casinos, and eSports equipment providers, making them attractive to investors.
However, the significant innovation propelling growth in the gaming and gambling industries has been their shift from their traditional setups to digital experiences powered by the internet and mobile technologies. An example of this is how online casinos have become widely accessible, allowing players to place bets anytime, anywhere.
The dazzling Las Vegas Strip lined with luxury Integrated Resorts, seen from a high elevation.
According to gambling expert Ciaran McEneaney, many USA online casinos have used these technologies to offer players various benefits like high-paying games, reliable payment systems, and enticing bonuses. These factors have played an important role in making the global online gambling market projected to hit $182.2 billion by 2031.
This projection is a compound annual growth rate (CAGR) of 11.5%. To improve their chances of reaching these numbers, many companies in the gambling sector have prioritized cybersecurity to make online gambling a more secure and convenient experience.
The gaming industry hasn’t been lagging either, as it has become very popular due to innovations like cloud gaming, mobile gaming, and virtual reality. These technologies have been crucial in helping the market generate over $183 billion in 2023 and they are a key reason why it is expected to continue its upward trend.
Which stocks are the best to consider in these sectors?
Take-Two Interactive is a well-known name in the gaming industry and is known for its blockbuster franchises like Grand Theft Auto and NBA 2K. A key reason for its investment appeal is its live service business model, which generates ongoing revenue through recurring in-game purchases. Additionally, the company’s strong franchises and innovative game development teams consistently deliver the best gaming experiences to attract and retain players, further enhancing its growth potential.
Another stock option worth keeping an eye on is Flutter Entertainment. The company operates some of the world’s leading sports betting and online gambling brands. What sets Flutter apart is its strong market position in both the US and European markets, allowing it to leverage a diverse portfolio that caters to a wide range of customers.
NVIDIA, known for its cutting-edge graphics processing units (GPUs), is another gaming stock worth investing in. The company behind this stock option has played a crucial role in transforming the gaming sector, by providing the technology that powers many of today’s popular games, particularly in eSports, where high processing power is essential.
Additionally, NVIDIA has branched out into cloud gaming with its GeForce Now service, positioning itself at the forefront of the gaming industry’s next phase. This service allows gamers to stream high-performance games on various devices without needing powerful hardware. NVIDIA’s stock is appealing to investors looking to capitalize on the broader gaming ecosystem instead of individual game franchises.
Las Vegas Sands is a major player in the casino and hospitality industry, with significant properties in Las Vegas, Macau, and Singapore. The company has begun shifting its focus toward online gaming and sports betting, making its stock attractive to investors seeking exposure to both land-based and online gambling markets.
Conclusion
The rapid evolution of the gaming and gambling industries, driven by digital transformation and changing consumer preferences, presents significant investment opportunities. Investors can explore a variety of stocks that offer exposure to diverse markets and the latest innovations backed by some of the biggest brands in these sectors. These four stock options not only promise growth but also the potential for substantial returns as these industries continue to expand.
