In this article, we discuss 5 best gaming stocks to buy now. If you want to see more stocks in this selection, check out 12 Best Gaming Stocks To Buy Now.
5. Las Vegas Sands Corp. (NYSE:LVS)
Number of Hedge Fund Holders: 42
Las Vegas Sands Corp. (NYSE:LVS) develops, owns, and operates integrated resorts, including The Venetian Macao Resort Hotel, the Londoner Macao, The Parisian Macao, The Plaza Macao, Four Seasons Hotel Macao, Cotai Strip, the Sands Macao, and Marina Bay Sands in Singapore. The resorts feature accommodations, gaming, entertainment and retail malls, convention and exhibition facilities, and celebrity chef restaurants, among other amenities. Las Vegas Sands Corp. (NYSE:LVS) is one of the best gaming stocks to buy now.
On October 13, BofA analyst Shaun Kelley upgraded Las Vegas Sands Corp. (NYSE:LVS) to Neutral from Underperform with an unchanged price target of $37. Uncertainty around Macau remains high, but the risk for Macau is now lower as compared to ten months ago, the analyst told investors in a research note. Las Vegas Sands Corp. (NYSE:LVS) shares offer “substantial positive estimate revision potential”, as per the analyst. On September 26, Jefferies analyst David Katz upgraded Las Vegas Sands Corp. (NYSE:LVS) to Buy from Hold.
According to Insider Monkey’s data, 42 hedge funds were long Las Vegas Sands Corp. (NYSE:LVS) at the end of the second quarter of 2022, up from 39 funds in the last quarter. Ken Griffin’s Citadel Investment Group is a prominent stakeholder of the company, with 3.6 million shares worth about $122 million.
Here is what Baron Real Estate Fund has to say about Las Vegas Sands Corp. (NYSE:LVS) in its Q2 2022 investor letter:
“Certain travel-related businesses remain cyclically depressed, not secularly challenged and should rebound as economic strength re-emerges. For example, the business operations of Macau-centric casino and gaming companies such as Las Vegas Sands Corporation (NYSE:LVS) have yet to recover due to the ongoing COVID-19 challenges in China. We expect business to rebound sharply when economic growth recovers just as it did in Las Vegas. Las Vegas Sands Corporation is a global leader in the development and operation of luxury casino resorts in Macau and Singapore, and it maintains a liquid and investment grade balance sheet. It is currently valued at a significant discount to our assessment of replacement cost, and the company’s Macau operations are valued at only 7 times estimated cash flow.”
4. Sea Limited (NYSE:SE)
Number of Hedge Fund Holders: 65
Sea Limited (NYSE:SE) is a Singapore-based company engaged in the digital entertainment, e-commerce, and digital financial service businesses in Asia, Latin America, and internationally. Sea Limited (NYSE:SE)’s Garena digital entertainment platform offers users access to mobile and PC online games, entertainment content, live streaming of gameplay, and online forums for user communication. Sea Limited (NYSE:SE) features as one of the best gaming stocks to buy now.
On August 17, Stifel analyst Scott Devitt assigned a Buy rating to Sea Limited (NYSE:SE) but slashed the price target on the shares to $95 from $105 after the company reported mixed Q2 results and retracted e-commerce guidance for the full year, citing heightened macro uncertainty. While he lowered his growth estimates for the second half to factor in the unpredictable macro backdrop, the analyst remains positive on the long-term trajectory of Sea Limited (NYSE:SE)’s margin improvements as management prioritizes profitability.
According to Insider Monkey’s data, 65 hedge funds were bullish on Sea Limited (NYSE:SE) at the end of June 2022, compared to 77 funds in the prior quarter. Chase Coleman’s Tiger Global Management is the biggest stakeholder of the company, with 8.2 million shares worth $548 million.
In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Sea Limited (NYSE:SE) was one of them. Here is what the fund said:
“Sea Limited (NYSE:SE), a global digital gaming and e-commerce company, detracted from performance for the period held. Similar to other online consumer businesses, Sea faced significant multiple compression in the quarter, exacerbated by a slowdown in user growth at its key Free Fire digital game and mounting investments in its e-commerce operation, particularly in new markets like Brazil. We exited our position as we lost confidence in the long- term unit economics in some of Sea’s new markets and were concerned by the simultaneous slowdown in revenue growth and increase in underlying cash burn.”
3. Take-Two Interactive Software, Inc. (NASDAQ:TTWO)
Number of Hedge Fund Holders: 66
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is one of the best gaming stocks to invest in. It is a New York-based company that develops, publishes, and markets interactive entertainment solutions for consumers worldwide. Some of its popular gaming franchises include Grand Theft Auto, Max Payne, Midnight Club, and Red Dead Redemption. Take-Two Interactive Software, Inc. (NASDAQ:TTWO) recently acquired Zynga, an American developer providing social video game services.
On October 5, Goldman Sachs analyst Eric Sheridan upgraded Take-Two Interactive Software, Inc. (NASDAQ:TTWO) to Buy from Neutral with a price target of $165, up from $131. The gaming industry continues to face short-term fundamental headwinds, but these headwinds are largely priced into the shares, the analyst told investors. The analyst sees some key industry themes and easier comps emerging after 2022, and he is also positive on the gaming industry’s latest moves to elevate the level of mobile gaming exposure and the upcoming “console cycle”.
According to Insider Monkey’s database, 66 hedge funds were long Take-Two Interactive Software, Inc. (NASDAQ:TTWO) at the end of June 2022, compared to 58 funds in the preceding quarter. Andreas Halvorsen’s Viking Global is a significant stakeholder of the company, with nearly 2 million shares worth $245 million.
Here is what Madison Funds specifically said about Take-Two Interactive Software, Inc. (NASDAQ:TTWO) in its Q2 2022 investor letter:
“Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is a leading publisher of video games. Take-Two has a reputation for the high quality of its games, having published industry favorites such as Grand Theft Auto and NBA2K.
The video game industry itself has shed much of its boom-and-bust patterns to become a steadier, more predictable business with high barriers to entry, established title franchises, and high levels of recurring, in-game revenue streams. The company has been investing heavily to step up the number of new title launches over the next few years, a favorable set-up which we believe is not fully reflected in its stock price.”
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 84
NVIDIA Corporation (NASDAQ:NVDA) is an American provider of graphics, computing, and networking solutions in the United States, Taiwan, China, and internationally. The company’s Graphics segment offers GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service, and related infrastructure and solutions for gaming platforms. NVIDIA Corporation (NASDAQ:NVDA) is one of the premier gaming stocks to consider.
On October 11, Citi analyst Atif Malik maintained a Buy recommendation on NVIDIA Corporation (NASDAQ:NVDA) but lowered the price target on the shares to $210 from $248. The analyst trimmed estimates for cloud data-centric semis.
According to Insider Monkey’s second quarter database, 84 hedge funds held stakes worth $3.3 billion in NVIDIA Corporation (NASDAQ:NVDA), compared to 102 funds in the earlier quarter worth $6.3 billion. Ken Fisher’s Fisher Asset Management features as a prominent stakeholder of the company, with 7.6 million shares valued at $1.15 billion.
Here is what Baron Fifth Avenue Growth Fund has to say about NVIDIA Corporation (NASDAQ:NVDA) in its Q2 2022 investor letter:
“At the company-specific level, there was a broad correction across the entire portfolio. While four of our holdings contributed to performance, the contribution to absolute returns was less than 100bps combined, as unfortunately none of them were large enough to move the needle. We had 16 investments detracting over 100bps each with NVIDIA (NASDAQ:NVDA), our second largest detractor, costing the Fund 254bps.
NVIDIA’s stock was hit even harder, down 44.4%, impacted by concerns over the health of the consumer, dramatic declines in crypto, and COVID-related lockdowns in China. Despite the sell-off and the increased near-term volatility in its gaming business, NVIDIA’s revenues grew 46% year-over-year with 48% operating margins, driven by continued strength in its data center business as companies across industries adopt AI and ML…” (Click here to see the full text)
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 258
Microsoft Corporation (NASDAQ:MSFT) is one of the best gaming stocks to buy now. Microsoft Corporation (NASDAQ:MSFT) offers PCs, tablets, gaming and entertainment consoles, and related hardware and software. The company also owns the Xbox network, an online multiplayer gaming platform. Microsoft is currently in the process of acquiring Activision Blizzard, Inc. (NASDAQ:ATVI), an American video game developer.
On September 20, Microsoft Corporation (NASDAQ:MSFT) declared a $0.68 per share quarterly dividend, a 10.0% increase from its prior dividend of $0.62. The dividend is payable on December 8, to shareholders of record as of November 17.
Wells Fargo analyst Michael Turrin on October 12 reaffirmed an Overweight rating on Microsoft Corporation (NASDAQ:MSFT) but lowered the price target on the shares to $315 from $350 ahead of two upcoming potential catalysts, namely the Ignite Conference and Q1 earnings.
According to Insider Monkey’s data, 258 hedge funds were bullish on Microsoft Corporation (NASDAQ:MSFT) at the end of June 2022, compared to 259 funds in the prior quarter. Chris Hohn’s TCI Fund Management is a prominent stakeholder of the company, with 19.6 million shares worth over $5 billion.
Here is what Lakehouse Capital specifically said about Microsoft Corporation (NASDAQ:MSFT) in its September letter:
“During the month, the Fund initiated a new position in Microsoft Corporation (NASDAQ:MSFT), a name that is no doubt familiar to our investors. The company was founded by Bill Gates and Paul Allen in a friend’s garage in 1975 and began dominating the operating system market with MS-DOS by the mid-1980s. The company has come a long way since then and is now widely considered the most critical and indispensable IT mega-vendor for businesses globally. In addition to its well-known Windows operating systems and Office productivity suite, the company has a broad portfolio of strategic products, including a rapidly growing public cloud business in Azure and a sizeable gaming presence.
Microsoft’s foundational products, Office365 and Windows365, are ubiquitous and highly penetrated with circa 90% and 80% market share, respectively. These solutions are deeply ingrained in commercial and personal use globally and across all industry sectors. They serve as stable, high-margin cash flow generators for Microsoft whilst they expand and invest in other growth areas of the business. One particular growth area, which is the most exciting part of Microsoft’s business in our view, is their public cloud service, Azure.
Azure has grown at a rapid clip over the past decade to cement itself as the second-largest cloud service provider globally, behind Amazon Web Services. The business benefits from strong secular tailwinds as cloud adoption continues unabated and there is considerable runway ahead – it’s currently estimated that less than 20% of global IT spend is currently in the cloud. Research indicates that 80% of enterprises use Azure and its market share has grown to 21%, up from 13% five years ago. The mission-critical nature of the product, which is similar to many of Microsoft’s other solutions, is incredibly attractive as it leads to sticky, recurring revenue streams. Something we love to see…” (Click here to read the full text)
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