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BenzingaEditorial

4 Feel-Good Gaming Stocks

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The gaming industry is on fire this year thanks to COVID-19 keeping more people indoors. The World Economic Forum forecasts the global gaming industry’s revenue is set to hit $165 billion for the whole year. This should benefit all gaming companies, even some that might not come immediately to mind. Penn National Gaming’s (NASDAQ:PENN), Tencent Holdings (OTC:TCEHY), Sony (NYSE:SNE), and Microsoft (NASDAQ:MSFT) are riding the gaming wave and surfing away.

Penn National Gaming – massive expansion ahead

Considering Penn’s 41 gaming properties in 19 states were forced to shut down during the pandemic, its stock made a great comeback. Most of its locations have reopened, but the recent surge in coronavirus cases is bringing a great deal of uncertainty. Fortunately, positive vaccine developments give hope that it won’t be long before Penn can return to operating at full speed. But even until that happens, online sports betting segment is doing extremely well. After all, this gaming operator has been successful over the last decade by managing both to growth revenue and maintain the operating margin in double digits. It was greatly helped when the Professional and Amateur Sports Protection Act (PASPA) was overturned in 2018 as this paved the way for for more states to legalize sports betting outside of Nevada, and 21 states have followed suit.

This year, it decided to invest in Barstool Sports, a sports media company, gaining more than 60 million monthly active users and more than 100 million social media followers. Besides this userbase, it gained advertising rights for 10 years on the Barstool Sports platform. It is already helping the company expand its offering of online sports betting in Pennsylvania with the launch of the Barstool Sports app in September which was the most-downloaded sports app the first weekend it became available, despite only being launched in only one state.

The majority of Penn National Gaming’s growth will come from online sports betting as the CEO Jay Snowden revealed that the company will massively expand to offer sports betting in every state in which it operates and where sports betting is legal by the end of next year.

Tencent – gaming is bright, but so are its other segments

The ecosystem of this conglomerate with a market cap greater than $700 billion includes a social media platform, fintech, e-commerce, and other products in addition to gaming that accounts for about one third of its revenue. It now has 140 licensed games under its umbrella. One of its more notable gaming-related acquisitions is its ownership stake in Epic Games who is the developer of Fortnite, with which it gained access to 350 million players.

In the latest quarter, gaming revenue increased by 45% compared to last year to $6.3 billion, which is a much greater rate than the total 29% growth of total revenue.

Tencent’s gaming growth may slow once the world moves past the pandemic but analysts forecast a 32% profit increase in 2021. But the bottom line is that this is a massive media company and gaming is merely one of its growth drivers as the company defines itself as a”world-leading game development, publishing, and operation platform.”

Sony is back in the game

Some of the businesses of the consumer electronics giant have suffered amid the pandemic, mostly due to supply chain disruption. However, the PlayStation 5 could bring a breath of fresh air. It is the first new console since the previous generation machine, the PlayStation 4, came out seven years ago. The PS5 will bring much more than faster load times and preliminary sales data out of Japan shows 120,000 units were sold in its first four day. This is almost six times more than Microsoft’s Xbox Series X and Xbox Series S sold during their first six days. However, this is only one country and the period does not include the holiday season.

The gaming division made up less than one-fourth of Sony’s revenue in the latest quarter, but it accounted for one-third of the operating income. Upcoming games such as Marvel’s Spider-Man: Miles Moralewill likely help enhance its gaming reputation and allow Sony the build further on this momentum.

Microsoft is not leaving gaming behind

Given Microsoft’s success in cloud computing, its gaming segment often gets forgotten. Still, the Xbox is a growth area within its “more personal computing” division. Like Sony Microsoft launched its next-generation Xbox, the Series S/X in November, seven years after its last-generation console, the Xbox One.

Admittedly, early Xbox sales numbers aren’t great but with the success of Xbox Game Pass, potential is there. The new consoles could also bring more interest in Microsoft’s games as of the end of fiscal 2020 that ended in June, Xbox Game Pass had 15 million subscribers and nearly 100 million Xbox Live players. Gaming revenue increased by 30% in the most recent quarter and it is expected to increase further with the release of the Series X.

Microsoft also signed a partnership with GameStop (NYSE:GME). It took some time for the troubled GameStop to recover after its stock cratered after the release of its third quarter earnings report, but it certainly appears this old dog is learning some new tricks as its gaming console upgrade cycle has officially kicked off.

Outlook

Gaming revenue is driven by consumers’ discretionary income. In other words, this is what’s left over in people’s wallets when they pay their bills and meet their basic demands. According to the Federal Reserve Bank of St. Louis, disposable income levels are higher than before the pandemic, in part because of the large stimulus package passed by the government and the gaming world benefited already with the outlook looking just as bright as COVID-19 won’t be conquered overnight.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

BenzingaEditorial

The EV Industry Is Worth More Than The Traditional Automakers

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Many things that were considered to be impossible actually happened in 2020. One of them is that electric vehicle makers became more valuable than traditional automakers and by about by about $100 billion, according to Barrons. EV makers are now worth about $1.3 trillion whereas traditional car makers combined have a market capitalization of about $1.2 trillion. This figure includes 100 auto makers around the globe with market caps ranging from $10 million all the way to Tesla’s (NASDAQ: TSLA). Based on its fully diluted share count, Tesla is worth about $1 trillion.

This feat is even more impressive if you consider that this is a much smaller industry based on actual number of cars. The last year taught us that the connection between the stock market and the economy is imprecise at best. However, the fact that technology enabled batteries to overpass ICEs is the kind of disruption that investors look for. Even though Tesla is the main contributor to the value of the EV market, the overall image is just as impressive as three of the top five most valuable are EV makers, with Tesla being followed by NIO (NYSE: NIO) and BYD (OTC: BYDDF). As for traditional automakers, Volkswagen (OTC: VWAGY) and Toyota (NYSE: TM) are the most valuable ones with both undergoing serious investments into electrification.

Traditional automakers are going electric

On Friday, BMW said it aims to double its sales of fully-electric vehicles this year. Including plug-in hybrids, it aims for a 50 percent increase in sales of electrified vehicles versus 2020. It did not give sales volumes for its fully electric vehicles but in data released on Tuesday, BMW said it sold close to 193,000 electrified vehicles, including fully electric and plug-in hybris in 2020. As a reminder, Tesla delivered almost half a million all-electric models last year, which is 75% of General Motor’s (NYSE: GM) third-quarter deliveries.

The automotive industry is at an inflection point

BEVs take approximately 1% of the total market for light vehicles, but the figure rises to about 3% if we include hybrid and plug-in hybrids. Why exactly it takes a relatively small market share to disrupt an industry is a bit of a mystery, but one reason is that more investment capital tends to flow in when market share come is within the 3% to 5% range. As more capital drives more innovation and improvement, investors are lured by high growth rates, bringing in even more capital and this is how success is made. Over the past year, EV makers have raised more than $20 billion in fresh capital, which is a fraction of what traditional auto companies spend on plants and equipment. However, on a per car basis, the EV industry is investing at roughly 10 times the rate of the traditional industry. Add to this President Joe Biden’s aim of a carbon-free future by 2035 and the drive toward adoption of EVs which is already seeing impressive results in Europe, the all-electric future is around the corner.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Europe and EVs- A Blossoming Relationship

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Tesla (NASDAQ: TSLA) delivered around 96,000 units to the key European EV market in 2020. But in Europe, Tesla’s cars were overtaken in popularity by Volkswagen (OTC: VWAGY) and Renault (OTC: RNLSY). Sales of electric vehicles by European car makers accelerated rapidly in 2020 amid severe fines for car markers whose fleets don’t meet new emissions targets and generous incentives for buyers to trade in their ICE vehicles.

Volkswagen

Volkswagen reported it delivered 212,000 electric cars across the globe in 2020, which is 158% more than in the year prior. 134,000 of those vehicles were battery-electric vehicles, which grew 197% compared with 2019. Volkswagen also said that its ID. 3 model was the top-selling car in Sweden in December by absolute numbers. All-electric Volkswagen models were on top the Netherlands and Germany, taking approximately 23% of each country’s BEVs market.

Mercedes Benz

On January 8th, Mercedes-Benz-owner Daimler (OTC: DDAIF) said that the brand sold more than 160,000 plug-in hybrids and all-electric vehicles in 2020, representing growth of more than 228% from 2019. The share of EVs in Daimler’s sales mix rose drastically from 2% in 2019 to more than 7% in 2020. Also, Mercedes-Benz brand remained the world’s top-selling luxury carmaker for the fourth consecutive year.

Renault

Renault reported that it doubled its electric-vehicle sales in Europe. While group sales fell more than 21% in 2020, its EV sales grew 100% growth from 2019 to 115,888 vehicles. Moreover, total orders at the end of December 2020 were up by 14% compared to December 2019, which was attributed to new hybrid offerings. EVs were the only good news in an otherwise bleak 2020 for the French carmaker, which underperformed both global and European car markets. At the very least, Renault avoided fines as it met its 2020 EU emissions targets. On January 14th, its chief executive officer Luca de Meo will present a strategy update which is expected  to include reviving some older best-selling models as all-electric models.

BMW

BMW (OTC: BMWYY) which also owns Mini, said that its two brands combined sold 192,646 electric vehicles in 2020 marking an increase of nearly 32% from last year. BMW also met its 2020 EU emissions targets.

Takeaway

European governments have created generous incentives to speed up the adoption of EVs, making them much more affordable. Come 2025 when emission targets become more stricter and threat of fines for not respecting them even greater, Tesla will certainly be playing against fully-fit opponents and could even potentially struggle. An EV-only future looks closer than ever in Europe as the race is now on to challenge Tesla’s leadership.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Lenovo Makes Its Star Market Debut

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The COVID-19 pandemic had completely changed the way people work and learn. Operating from home actually turned around declining PC sales. Smartphones have been picking more and more market share from PCs and if there was no pandemic, this would probably still be the case. But instead of decreasing demand, there was record growth in PC sales as video collaboration software was needed to fulfill the need caused by closed offices and schools. The demand generated months and months of production. According to Reuters, sales of desktops, laptops, and tablets are expected to reach the level of 300 million shipments, the first time after its peak in 2008. This made all the PC manufacturers like Dell Technologies Inc. (NYSE: DELL), HP Inc. (NYSE: HPQ), and Lenovo Group Ltd. (OTC: LNVGY) very happy.

Lenovo CDR story

China’s Lenovo Group is listed at the Hong Kong stock exchange, with about 12.04 billion shares outstanding in total as of January 12th. The company decided to issue Chinese Depository receipts (CDRs) which will be up to 10% of the total number of shares to be listed on the Star Market of the Shanghai Stock Exchange. The proceeds from the issuing of CDRs is planned to help the company’s research and development of new technologies, development of new products and solutions, and overall strategic investments in core segments. On Wednesday, the news caused to stock to drove the stock to its highest level since 2015.

The Star Market

The Star Market was launched in 2019 aiming for innovative technology companies that need more relaxed listing rules. In December, the Star Market counted 200 companies. A CDR or Chinese Depositary Receipt is a way for non-Chinese companies to list their shares in China. This is the equivalent to American depositary receipts (ADRs) which allow non-U.S. companies’ shares to trade on American exchange markets. Technically, CDRs and ADRs are not companies’ shares, but they represent an equity interest in a company. Besides Lenovo, an AI startup that specializes in facial recognition called Megvii Technology Ltd will also be among the first companies to benefit from this new structure.

Conclusion

Lenovo’s listing should be a breakthrough for Shanghai’s Science Technology and Innovation Board. Lenovo, a flagship of the Star Market, should attract much more followers and clear a path for many Chinese start-ups to raise capital in their home country. The company’s strong and growing global presence should continue to demonstrate the boom of China’s capital market and attract more investors to invest.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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