Market News #44 - May 9-13 | Video games and Disney: which stocks to watch this week? 🗞

May could be another turbulent month on the stock market with continued volatility in the US indexes and more inflation data on the agenda. But rest assured, this can create opportunities! Here are some stocks and events to watch this week.

Ready Player One? EA and Ubisoft report earnings :video_game:

Get your controllers ready. The video game industry is in the spotlight this week with two crucial quarterly reports.

The gaming sector enjoyed a huge boost during the pandemic, as many people stayed at home and played video games! The industry grew by 23% in 2020 but Bloomberg explains that this growth rate is unlikely to continue this year. However, research firm Newzoo still predicts that revenues will reach $219 billion by 2024.

On Tuesday May 10, the American gaming group Electronic Arts will present its quarterly figures. EA is expected to post revenue of $1.49 billion, an increase of 18.8% year-on-year. The outlook is also positive for the group, which is now banking on cryptocurrency microtransactions to boost in-app purchases in its various games.

French video game company Ubisoft will report the following day, Wednesday May 11th. Analysts expect revenue of €2.18 billion euros, which is down slightly year-on-year. Some analysts are also watching Ubisoft closely after Microsoft recently acquired Activision Blizzard. Could Ubisoft be the next gaming company to get acquired by a bigger tech giant? Incidentally, Ubisoft has just created a buzz by bringing the iconic game Adibou back to life in a mobile version for children.

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Will the streaming war impact Disney’s numbers? :tv:

You probably saw the disappointing subscriber numbers at Netflix last month, which dropped for the first time in ten years. Now, all eyes are on Walt Disney. Indeed, revenue from Disney+ helped carry the company through the pandemic while cinemas shut down and theme parks closed their doors. But with stiff competition in the streaming world, Disney is also struggling as the stock is down 43% from its all-time high.

Unlike Netflix, however, subscriber growth continues to increase for the group, which bodes well. At the same time, amusement park attendance is also on the rise: spending in parks had already increased by 40% last quarter (year-on-year). Finally, strong growth is expected on the group’s earnings per share (EPS) for this quarter: Disney should post an EPS of $1.20, which would represent a +51.9% growth year-on-year. The full results are due on Wednesday May 11th.

Economic and earnings calendar :calendar:

Monday – Trade balance in France (March). Speech by the US Federal Reserve at the International Monetary Fund Panel. Quarterly results from BioNTech, Infineon, Palantir, PostNL, Lemonade, Trigano.

Tuesday – Inflation rate in the Netherlands (April). Industrial production in Italy and Belgium (March). ZEW index of economic sentiment in the euro zone (May). Quarterly results from Bayer, Electronic Arts.

Wednesday – Inflation rates in Germany and the United States (April). Quarterly results of Walt Disney, Ahold Delhaize, Continental, Ubisoft.

Thursday – IEA report on the oil market in France. Inflation rate in Ireland (April). US weekly unemployment figures. Quarterly results of Allianz, Merck, RWE, Veolia, Bouygues, Siemens.

Friday – Inflation rate in France and Spain (April). Industrial production in the euro zone (March). Quarterly results of Deutsche Telekom, Exor.

Interesting to read :books:

BUX Broadcast #52 | Wat is een flash crash? :netherlands:

BUX Börsenausblick #42 | Ein Blick auf Roblox & Bumble :de:

Are you currently investing in any video gaming-related companies? :thinking:

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We’ll be back next week with another edition of Market News. In the meantime, have a great week on the markets! :wave:t4:

All views, opinions, and analyses in this article should not be read as personal investment advice and individual investors should make their own decisions or seek independent advice. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication.

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I’m actually really curious to see if governments will start cracking down on lootboxes in the coming years (or at least similar crackdowns as The Netherlands and Belgium have done). From what I remember it makes by far the most revenue for big gaming companies nowadays. (I mean EA pretty much invented this disgusting gambling landscape in games)

Seeing as games started doing it way more last few years, it will probably catch the eyes of at least a few of those boomers that make up the rules.:sweat_smile: It feels like glorified gambling for kids to me atleast. (And on a personal note I also think it ruins my experience with games :weary:). Would be a massive blow to anyone holding game stocks for the long run though.

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