Activision Blizzard, Inc. (ATVI), Microsoft Corporation (MSFT): Make Video Gaming Stocks a Part of Your Portfolio

On the operating margin front, Activision Blizzard is head and shoulders above the competition – the company’s efficiency is far higher than its competitors. Not only that, the company also has a 1.2% dividend yield while Ubisoft and Electronic Arts Inc. (NASDAQ:EA) do not provide dividends to shareholders.

Electronic Arts, on the other hand, reported net loss in its latest earnings report, earlier this month. The company’s stock rose on the back of this news as it was a smaller-than-projected first-quarter loss thanks to strong cost controls and digital sales. The company delivered on top-line growth and margin expansion, while keeping costs in check in the latest quarter.

It still faces considerable risk for the remaining quarters of the year, however. The results highlight Electronic Arts’ transition from the maker of games previously only sold at retail store to now being able to generate most of its sales and revenue from digital downloads for the next five years.

The verdict

The three video-game producers have a seemingly positive months ahead through 2014. Sales and revenue increases are expected as the newly launched consoles help heighten interest in new titles.

That being said, Electronic Arts has risk attached to its stock due to its lack of performance, while Ubisoft and Activision Blizzard have got a lot more potential to reward shareholders – especially as the launch of famous game titles quickly approaches. Buy Ubisoft and Activision to make the most of a strong end to the year.

The article Make Video Gaming Stocks a Part of Your Portfolio originally appeared on Fool.com and is written by Awais Malik.

Awais Malik has no position in any stocks mentioned. The Motley Fool recommends Activision Blizzard. The Motley Fool owns shares of Activision Blizzard. Awais is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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