Two Ways to Play Video Game Stocks

Game Start.

Glu Mobile soared earlier this week after Electronic Arts announced its acquisition plans. $ 2.1 Billion Mobile Game Developer..

Meanwhile, Take-Two Interactive fell on Tuesday despite the quarterly beats. The company behind Grand Theft Auto and Red Dead Redemption didn’t announce a release slate, but targeted 93 titles in five years.

Nancy Tengler, chief investment officer at Laffer Tengler Investments, told CNBC on Tuesday that he would cut positions if he owns Take-Two. She said one name in the space looks much more attractive.

“We’ve been playing gaming games through Microsoft, partly because we’re getting more growth,” Tengler said in “Trading Nation.”

According to FactSet, Microsoft is expected to record profit growth of nearly 30% for the full year through June. Sales are projected to increase by more than 14%.

“The latest announcement and launch of Xbox was the highest in the company’s history. Game revenues exceeded $ 5 billion for the first time, Xbox Live has more than 100 million monthly active users, and Game Pass reaches 18 million. And that’s our play, as the cloud business and you also have Office and Teams, ”says Tengler.

Mark Tepper, president of Strategic Wealth Partners, has invested in another video game stake, Activision Blizzard.

“Currently, Activision is one of our top five holdings. In my opinion, they have some of the best video game franchises. They have transitioned very well to in-game purchases. It has a great and powerful mobile footprint, and that’s what many of these video game makers want, “Tepper said in the same interview.

Still, it may make sense to keep or unload some of the stock after it has been run. Stock prices have risen more than 100% since their lows in March.

“Unfortunately, I think we’ve made the easiest profits with video games, so we’ll be adjusting that position soon,” says Tepper.

Disclosure: Laffer Tengler Investments owns MSFT. Strategic Wealth Partners holds ATVI.

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