Though the stock market is in flux, some stocks are stagnant or even on the rise. Activision Blizzard (ATVI) is one of the few bucking the general trend.
The company can easily withstand a market downfall. This is not to say the video game industry is recession-proof, but Activision Blizzard’s offerings are so captivating that investors can hold their position without worry, regardless of how low the market dips.
Even if the market were to drop several thousand points and the economy were to enter a prolonged trough, Activision Blizzard will still rake in the cash. People will continue to pay for video games, especially elite games like those made by Activision Blizzard, as they will be spending more time in the home. In this sense, some video game companies really are somewhat recession-proof.
Experienced PC gamers universally testify Activision Blizzard games are the cream of the crop. From Overwatch to Diablo and the global hit Call of Duty, this gaming company has some of the best titles in the business. These hit games are the gifts that keep on giving. Activision Blizzard has rolled out one sequel after another, year after year, making copious amounts of money. The money train will keep on chugging along even if the stock market and recession slide.
Imagine a scenario in which the stock market loses another 10%. The fed runs out of solutions to resuscitate the economy, consumers reign in spending, hiring slows and the economy begins to crater. If such a scenario were to unfold, people will spend that much more time indoors as domestic entertainment is comparably cheap. Video games provide a much-needed escape during economic lulls. Furthermore, gamers do not hesitate to spend for new content as today’s games provide hundreds or even thousands of hours of gameplay.
Part of the challenge in winning a substantial portion of the video game market share is to connect with gamers across as many platforms as possible. Access is one of Activision Blizzard’s many strengths. The company makes it easy for PC gamers, mobile device users and even gaming console owners to play the company’s titles.
All in all, over 350 million gamers use Activision Blizzard content every month. The typical gamer plays the company’s titles for 50 minutes each day. The beauty in building such a massive loyal following is multi-fold. For one, these gamers are more than willing to purchase multiple titles in the same gaming series across years or even decades. Furthermore, loyal gamers are willing to pay for content beyond the initial purchase price. Activision Blizzard is also making considerable amounts of money through in-game sales, upgrades, subscriptions and even advertising within games. The game maker has multiple income streams that will set the company up nicely regardless of which direction the industry takes in the years to come.
Those who follow the video game industry are well aware the industry is shifting toward e-sports. The company’s Overwatch title is one of the most celebrated e-sports games. Overwatch live events have emerged as incredibly popular video game competitions with true mass appeal. Activision Blizzard has signed deals with a dozen professional sports team owners along with media companies like Disney and Amazon. Overwatch is set to approach the $1 billion revenue benchmark by the end of the year. If you are looking to capitalize on the influx of interest in esports, Activision Blizzard just might be one of the best places to park your money.
The average person does not have a video game console, yet he or she certainly has a smartphone or a web-connected mobile device. Activision Blizzard has worked tirelessly to bring the company’s epic titles to these seemingly ubiquitous mobile devices. The company’s mobile business, King Digital Entertainment, had more than 270 million active players this past quarter. Activision Blizzard has teamed up with Tencent to provide Chinese gamers with the global hit Call of Duty. It can be said without even the slightest hesitation that Activision Blizzard is at the forefront of the gaming expansion.
Invest in this superstar gaming company, take a look at the stock’s price every couple months, hold for the long haul and you will be more than happy with your return.
Regards,
Ethan Warrick
Editor
Wealth Authority
