CNBC’s Jim Cramer warned investors Thursday not to take beat-up stocks of video game companies activism blizzard And Take-Two Interactive Software just yet.
“I’m not saying they’re going to go down at this point — I certainly think they have more downside — but at some point they’ll be cheap enough to be worth buying. It’s just that we’re aren’t there yet,” he said.
Some other names to keep an eye on include Sony, amd, Microsoft And NVIDIAaccording to Cramer.
Video game companies saw their stocks skyrocket during the height of the Covid pandemic as consumers hunkered down and turned to at-home entertainment. This changed when the economy reopened, leading to a spurt in outdoor activity.
“In other words, life is too short To stay home to play video games, or at least that’s what consumers feel like at the moment,” Cramer said.
He said companies are also weighed down by their reliance on revenue streams from digital advertising, which has seen a slowdown as the Federal Reserve raised interest rates to slow the economy.
Still, the barriers facing the video game industry will likely ease, though it’s not clear when, Cramer said.
“While the video game industry came out of 2022 looking like one of the biggest losers… I think this may just be a temporary problem, not a permanent one. It’s too soon to start fishing here.” But eventually, there will be a bottom,” he said.
