Epic Games stock has taken the world by storm. Recently listed on the Nasdaq, Epic Games’ shares have surged since going public in late December and have traded as high as approximately $350 per share.
Whether you’re a veteran investor or just starting out, Epic Games offers plenty of opportunities for people looking to get into investing. Here’s a look at what you need to know before diving in.
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Understand the Risks and Rewards of Investing in Epic Games Stock
Before buying any investment, it’s important to understand both the rewards and risks associated with it.
With regard to Epic Games, investors need to consider that their stock price is dependent on the success of its products (e.g., Fortnite), which could be affected by competing products and changing trends.
Investors also need to realize that investing in any company involves some degree of uncertainty and risk, no matter how profitable they may appear to be.
Understanding Valuations
It’s also important for investors to understand that epic games has been privately held until recently, so there isn’t as much information available about its business operations compared to other established public companies.
This means investors need to do additional research about potential investments, such as per-share metrics like price-to-earnings (P/E) ratio and dividend yield – both of which can give insights into whether an investment could outperform or underperform the market over time.
Sticking with the Long Term
If you decide that Epic Games is an attractive investment for your portfolio, it’s important for you to remember not to get too caught up with short term movements in its stock price; after all, no one knows what will happen in the future.
Instead, focus on long-term trends and be sure your investments are diversified enough so losses from one company don’t destroy your overall wealth goals.
Epic Games stock has been steadily rising in recent months due to the huge success of its flagship product, Fortnite. The media giant behind popular video games such as Gears of War and Unreal Tournament, also benefited from some strategic acquisitions that put it further ahead of rivals in the gaming industry.
But what is driving its stock price and should investors consider buying into Epic Games?
What’s Driving Epic Games Stock Price?
The primary driver of Epic Games stock is its hit battle royale game, Fortnite, which continues to dominate the gaming industry.
The game’s popularity and ability to capture a wide demographic with its cartoon-like art style have propelled it past other major competitors in the space such as PlayerUnknown’s Battlegrounds and Apex Legends.
Fortnite is estimated to have earned about $4 billion as of February 2020. Additionally, Epic Games’ exclusivity deals with top streamers and YouTubers have netted them an even larger revenue stream from eye balls on their content.
Should Investors Consider Buying Stock?
Given the success of Fortnite and its potential for continued growth, now may be a good time for investors to look at investing in Epic Games stock.
It could be a lucrative investment if the company can continue to innovate and improve upon existing titles while developing exciting new ones that keep players coming back for more.
Though there are always risks associated with any stock purchase, Epic Game’s track record suggests that they know how to navigate these uncertain times effectively by introducing new products or partnering with other large companies in meaningful ways.
Performance of Epic Games Stock
Over time, Epic Games shares have steadily risen and as of 2021 it is trading at approximately $88 per share. This represents a 707% increase from when it first began trading on NASDAQ in November 2018 at $11.83 per share.
Additionally, the company’s market capitalization stands at over $40 billion making it one of the most valuable and popular video game companies out there today.
Risks and Considerations for Potential Investors
As with any investment there are risk factors that need to be taken into consideration before investing in Epic Games shares or any other type financial security for that matter.
Such risks may include macroeconomic factors like interest rates or currency fluctuations along with other more specific business-related risk factors such as consumer demand for their products or changes in technology.
Additionally, investing in any individual company carries political risk which could affect their stock performance negatively should geopolitical events take place that adversely affects their business operations
