Personal Finance

Why Activision Blizzard, Inc. Popped 17% in January

A screenshot of Activision Blizzard's Call of Duty: WWII game

What happened

Shares of Activision Blizzard (NASDAQ: ATVI) surged 17.1% last month, according to data from S&P Global Market Intelligence . The video game maker is dominating the sales rankings, while also making a bold move into the exploding market for esports.

So what

Activision Blizzard entered January with momentum, after two of its games -- Call of Duty: WWII and Destiny 2 -- placed No. 1 and No. 2 among the best-selling video games of 2017. The strong sales performances of these titles landed Activision a slew of analyst upgrades and price target increases.

A screenshot of Activision Blizzard's Call of Duty: WWII game

Activision Blizzard's was the best-selling video game of 2017. Image source: Activision Blizzard.

Activision Blizzard's Call of Duty: WWII was the best-selling video game of 2017. Image source: Activision Blizzard.

The stock's ascent accelerated after Activision announced that it had struck a multi-year media rights deal with Amazon.com 's (NASDAQ: AMZN) Twitch video streaming site. Amazon will reportedly pay $90 million over two years for streaming rights to Activision's new Overwatch esports league . Days later, Overwatch League went on to draw more than 10 million viewers during its opening week.

"This league demonstrates the power and potential of esports, and we're thrilled to continue expanding our partnership with Blizzard," Twitch COO Kevin Lin said in a press release.

Now what

Activision Blizzard's shares have pulled back about 8% so far in February, after the company released good, if not great, fourth-quarter results . Investors may wish to consider using this pullback as a buying opportunity. Activision has multiple catalysts that can propel its growth in the coming years, including movies and TV shows , consumer products , in-game advertising , and, of course, esports. As such, the video game titan gives investors many ways to profit.

10 stocks we like better than Activision Blizzard

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Activision Blizzard wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of February 5, 2018

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Activision Blizzard and Amazon. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

AMZN ATVI

Other Topics

Stocks

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More