Three Stocks To Buy On Fortnite Video-Game Craze

Very few people could have imagined how popular Fortnite, a third-person shooter video game would become on the release of free-to-play battle royale. As of the start of the month, over 45 million people had already played the game, and the trend appears to be gaining momentum by the day.

NVIDIA Corporation (NASDAQ:NVDA), Tencent Holdings Ltd (OTCMKTS:TCTZF), and Activision Blizzard, Inc. (NASDAQ:ATVI) have emerged as a must own stocks, as the Fortnite craze continues to hit higher highs.

So what makes the three stocks exciting picks on Fortnite’s fortunes?

Tencent

Tencent stands to be one of the biggest beneficiaries of more people playing the video game in part because of its 40% stake in Epic Games, the creator of the games. Even though the game is free to play, the creator is already reaping big from the sale of virtual items such as character costumes and emoticons used by gamers to express a thought or a feeling.

In addition to other merchandise sales tied to the game, there is growing belief that Fortnite craze could generate as much as $2 billion in revenue. Tencent being one of the majority shareholders in Epic Games thus remains to be the biggest beneficiary of soaring revenues.

Tencent has also developed and debuted two games in China that are somehow similar to Fortnite based on licensed IP from which it expects to generate significant returns. The company is also in the process of seeking regulatory approval to offer Fortnite in China.

Activision Blizzard

Concerned by the hype around Fortnite video game, publisher Activision Blizzard is reportedly planning to add a battle royale mode dubbed ‘Blackout’ to its billion-dollar franchise Call of Duty. The new model will allow Call of Duty enthusiast to compete against each other featuring iconic characters and locations to form all its four Black Ops Game

A battle royale mode where gamers are allowed to compete against 99 others with the winner being the last one left standing appears to be the new thing, in the gaming world. While it is not clear whether Activision Blizzard own mode in Call of Duty will be a success as Fortnite, its still presents an exciting opportunity given its success with previous releases that have ended up being blockbusters.

NVIDIA

Nvidia is one of the few companies that is not a video game developer but still poised to be one of biggest beneficiaries of the Fortnite phenomenon. The giant chip maker is better known for its industry-leading graphics processing unit, without which gamers will not be able to play their beloved games.

Growing demand and new players joining the ranks to play Fortnite or new games leveraging the ‘battle royale mode’ is thus expected to trigger an increase in demand for GPU’s to power hardware for playing such games.

NVIDIA’s gaming segment grew by 66% year-over-year in the recent quarter thanks to strong demand for graphics processing unit. Chief Executive Officer, Jen Hsun Huang has already acknowledged that increased adoption of the battle royale genre will continue driving sales in the company’s gaming segment.