Why Ignoring This Sector Is A BIG Mistake
If you’ve ever met my father, he would likely be described as about the furthest thing from what kids call a “gamer” these days.
He’s a big, grizzled man who’s donned a beard for over 30 years. His skin is weather-beaten from working hard outside. When he’s not working at his hardware and feed store, he’s out feeding cattle, chopping firewood, or loading up straw and hay.
In short, he’s a stark contrast to Tyler Bevins, aka, “Ninja” — one of the biggest video-game players in the world. He’s often found sporting bright pink hair and boasts over 24 million subscribers on his YouTube channel.
But this stark contrast between two people represents a larger disconnect from the burgeoning gaming sector and investors (as well as our readers).
You Can’t Afford To Ignore This Sector
You see, I was talking with one of our marketing people recently about the massive — and growing — gaming industry. I told him that I believe it could be a playground for great investments, as well as some marketing material.
He said they had a tough time “selling” the gaming sector to our demographic, which mainly consists of readers nearing or in retirement.
It’s likely because our readers didn’t grow up “gaming” like kids do today. They may have purchased a Nintendo gaming console for their kids or grandkids at some point. But for the most part, the interest ended there.
And I get it… if I tried to tell my father about how “battle royale” was taking the gaming industry by storm, or that you could even play and chat with people from all over the globe while playing a game, it simply wouldn’t register with him. He might nod his head, but he’d quickly turn his gaze to the weather channel or go back to plucking his guitar.
I couldn’t even imagine what he might think if I revealed that kids can now get a college scholarship for playing video games. He likely wouldn’t be able to grasp why people would want to watch others play a videogame. And he would be extremely skeptical (and perhaps disappointed) to learn that more people tuned in to watch the world final of League of Legends (a game) than the 2018 Super Bowl.
Even if I told him that esports stars can walk away from tournaments with millions in winnings, he probably still wouldn’t be interested. And I wouldn’t even want to bother divulging that these people playing video games are called “athletes”. He might keel over with a heart attack.
But you know what he does understand? Stock charts like this one…
This is a chart of gaming and multimedia company Sea Limited (NYSE: SE), which has soared thanks in large part to its portfolio of popular mobile and PC online games.
If that’s not enough to get your attention, I don’t know what is…
And here’s the thing. I think we’re going to look back in a few years and see a lot of charts like this. The only question is were you on board for the ride… or not?
The Gaming Industry Is Being Flooded With Big Names And Big Money
Consider these remarkable facts about the gaming industry…
- It already has a larger audience than American football and rugby combined
- Forecasted to grow at a 24.4% compound annual rate between 2020-2027
- The gaming market is expected to reach $200 billion by 2022… two times bigger than Hollywood
- Call of Duty franchise — a first-person shooter game — generated more revenue than the entire Marvel and Star Wars franchises commanded at the box office,
The esports megatrend is still in its early innings. Up to this point, it’s lacked dedicated investment fund managers who know how to grow a business and extract value for investors. But that’s all beginning to change…
Will Smith, David Beckham, Drake, and a number of other celebrities and sports stars have all invested in the esports industry. Big institutional investors are also beginning to realize the potential. Well-known outfits like Sequoia Capital and venture capital firms are beginning to invest in the space in earnest.
Plenty of off-shoots from the esports industry will also appear and make savvy investors money. You’ll have the college esports scene, which will be monetized similar to college football or basketball. Then you’ll see health and wellness products and supplements dedicated to gamers.
Events and experiences similar to other sporting events will be a moneymaker. Couple that with trade shows, gaming tourism, etc. Then there’s brand exposure, gamer merchandise, esports betting, gaming tech… the list goes on.
The bottom line is that all these tailwinds are providing the gaming-industry with exciting momentum and growth.
How You Can Profit
There are several ways you can gain exposure to the growth we’re seeing in this industry today. One is with the Chinese firm Tencent Holdings (OTC: TCEHY) — which happens to be the largest gaming company in terms of revenue.
We’re up 109% since July 2017 when we added it to the portfolio over at Top Stock Advisor.
Then we have our most recent gaming addition, Electronic Arts (NYSE: EA). This has done well for us since we added it to the portfolio at the beginning of February — up 35%.
But there’s plenty of other stocks that I will be keeping my eye on for more exposure to the industry (and profits).
For instance, I’m excited about the recent initial public offering of Unity Software (NYSE: U), which went public on September 18. Unity is a platform on which creators can create games for consoles, computers, or mobile applications. I will likely wait until the dust settles, as I’m typically not a fan of investing in recent IPOs.
Next year we will likely see another online gaming platform, Roblox, go public (it postponed its IPO, which was scheduled for November 19).
Other interesting companies on my “gaming” watchlist are Bilibili (Nasdaq: BILI), Corsair (Nasdaq: CRSR), and Turtle Beach (Nasdaq: HEAR).
Action To Take
Remember I mentioned Sea Limited earlier? Over at Maximum Profit, we’ve used our proven system to make 263% since adding it to the portfolio in May. Just food for thought…
Here’s the thing… you don’t have to like the gaming industry or get excited about it. But you can like and get excited about the potential profits that it could deliver.
Again, it might be hard for many folks to grasp the idea that people would want to tune in to watch someone else play a video game. But the fact is, it’s happening… and it’s happening in large numbers. For gaming viewers, it isn’t any different than you or me flipping on the television to ESPN to watch a baseball or football game.
I understand the enthusiasm for many folks simply won’t be there to take the time to research — and invest — in the gaming industry. But I urge you to keep an open mind.
P.S. Over at Maximum Profit, we’re aiming our proven system on a number of hot sectors, making triple-digit profits in a matter of months (or even weeks)…
But 5G technology could be the biggest one yet. That’s why I just released a brand-new special report that tells you everything you need to know – including how we’re going to profit.
Want to get your hands on it? Go here now to learn more…