5 Best Gaming Stocks to Buy Now

4. Zynga Inc. (NASDAQ: ZNGA)

Number of Hedge Fund Holders: 47

Zynga Inc. (NASDAQ: ZNGA) is a gaming company providing social game services in the US and internationally. It develops and operates social games as live services on mobile platforms like the Apple iOS and Google Android operating systems. The company ranks 4th on our list of the best gaming stocks to buy now.

This May, Zynga Inc. (NASDAQ: ZNGA) was upgraded to Buy at BofA after the company released its strong first-quarter earnings. The price target for the company is not $13.5 at the firm. The company also beat bookings and revenue estimates in Q1, leading to it gaining in the aftermath. Zynga Inc. (NASDAQ: ZNGA) also announced this May that it would be acquiring Chartboost for $250 million and gain the firm’s audience of over 700 million monthly users and 90 billion monthly ad auctions in the process. In the first quarter of 2021, Zynga Inc. (NASDAQ: ZNGA) had an EPS of $0.13, beating estimates by $0.04, while its revenue was $680.3 million, up 68.49% year over year, and beat estimates by $40.21 million. The company has a gross profit margin of 58.85% while the stock has gained 9.22% in the past 6 months and 10.34% year to date.

By the end of the first quarter of 2021, 47 hedge funds held stakes in Zynga Inc. (NASDAQ: ZNGA) worth roughly $11.4 billion. This is compared to 52 hedge fund holders in the previous quarter with a total stake value of approximately $10.02 billion.

Artisan Partners Limited Partnership, a high value-added investment management firm, mentioned Zynga Inc. (NASDAQ: ZNGA) in its fourth-quarter 2020 investor letter. Here’s what they said:

“We also added to our position in Zynga. Our multiyear investment campaign in Zynga has been based on a new management team’s ability to drive steady growth in the company’s base portfolio of games, expand margins, reinvigorate the new game development pipeline and use its strong balance sheet to acquire complementary games and studios. Shares have been pressured in recent quarters, presumably because of investor concerns about the company’s moderating growth rate and Apple’s pending new privacy policy which will make it more difficult for Zynga to both efficiently acquire new players and sell advertising in its games. We believe the company has multiple growth levers it can pull in the periods ahead, including the rollout of new games, acquisitions, further penetration into international markets and entry into new gaming categories, to name a few. Furthermore, our research suggests the Apple privacy policy change is manageable for larger mobile game developers such as Zynga. Given our strong conviction in the profit cycle, we used recent weakness to add to our position.”