2 video game stocks to buy in October

The year of 2020 could easily be remembered as a year when the gaming industry reached new highs. The pandemic forced people to stay at their homes and, therefore, increasing the amount of time they spend on home entertainment. 

New consoles coming

The gaming industry will welcome new consoles next month, which is likely to increase the spotlight on video game producers, who will be hoping that gamers are willing to spend more money on new releases. 

Microsoft and Sony are expected to roll out their new consoles in November. New consoles will yield new versions of popular video games. Initial reports note that new releases are likely to come at higher prices. 

For instance, the popular basketball game NBA 2K21 will cost $70 on Xbox Series X and PS5. Price hikes pushed Sony to introduce a price ceiling of $70 per game. 

Some analysts believe that now it’s a right time to hike prices.

Here are two stocks that I believe will prove to be a good investment now given that the gaming industry will welcome new consoles next month. 

Microsoft (MSFT)

Microsoft will release its Xbox Series X in November. The console is priced at $500, while the digital-only version costs $300. The company’s exposure to the video gaming industry increased after an acquisition of ZeniMax Media for $7.5 billion.

Microsoft stock price closed the week 0.78% in the red to protect gains it made two weeks ago. From the technical side, the zone around $190 offers a great opportunity to buy MSFT shares. 

Activision Blizzard (ATVI)

Activision Blizzard (NASDAQ: ATVI), which produces one of the world’s most popular video games World of Warcraft (WoW), disappointed gaming fans this week after delaying World of Warcraft: Shadowlands.

However, the delay shouldn’t create too much trouble for the company. Jefferies’ analysts believe that the deal is a “non-issue” as they place the price target of $105.00 per share for ATVI.

News pushed ATVI stock lower to close the week over 3% in the red. A further move lower to $75 should offer a new buying opportunity.

Summary

As video games are mostly used in homes, they have become an increasingly popular option for many consumers during the time of the pandemic. Microsoft and Sony are both releasing new consoles in November, paving the way for higher revenue from console and video games sales.