5 stocks to capitalize on the boom of the Metaverse space - October 12, 2022

5 stocks to capitalize on the boom of the Metaverse space – October 12, 2022

The pandemic-led social transformation has made digitization the new normal. The outbreak of the Corona virus quickly changed the lifestyle and people followed. People who are not fully accustomed to digital platforms for doing office work (working from home), ordering food and other daily needs, transferring money and making payments, are now fully prepared for these activities.

In 2020, the United Nations Conference on Trade and Development (UNCTAD) reported that “the global crisis brought on by the coronavirus pandemic has pushed us into a digital world, and changes in behavior are likely to have lasting effects as the economy begins to recover. The future will be much more digital than it is.” Now. the past. This will provide a major impetus for the development of artificial intelligence and cyberspace activities.”

Metaverse – Latest Coming

The latest emergence of the digital space is the metaverse. In short, metaverse means an interactive and collaborative virtual world. The digital space is powered by the use of virtual reality and augmented reality.

According to Bloomberg estimates, the market opportunity for the metaverse is expected to reach $800 billion by 2024 from $500 billion in 2020. The primary market for online game and game console makers could exceed $400 billion in 2024 while the remaining business will come from live streaming . Entertainment and social media. Games, AR, and VR create a $413 billion primary market for the metaverse.

According to verified market research, citing a PRNewswire article, the metaverse market size is, in fact, estimated to reach $824.53 billion by 2030 from $27.21 billion in 2020. The market is expected to experience a compound annual growth rate of 39.1% from 2022 to 2030.

stock to watch

We’ve narrowed our research down to five stocks that have the potential to become major players in the metaverse space.

NVIDIA Corp. (NVDA Free report) capitalizing on strong growth in GeForce desktop and laptop graphics processing units (GPUs), driving gaming revenue. The latest NVDA GPUs will likely play an important role in the development of the metaverse. NVIDIA’s acquisition of Mellanox is a major catalyst in this regard.

The NVIDIA Omniverse Enterprise platform is an end-to-end collaboration and simulation platform that essentially transforms complex design workflows in a 3D space. This virtual content creation platform allows designers, creators, and engineers to easily share their materials in a digital space.

Zacks Rank #3 (Hold) NVDA estimates revenue growth of 2% for the current year (ending January 2023) and 14.4% for the next. Zacks’ consensus estimate for this year and next year’s earnings have improved 1.2% and 0.4%, respectively, in the past 30 days.

Alphabet Inc. (The Google Free Report) is rapidly growing in the booming cloud computing market. GOOGL’s cloud offerings include Google Cloud Platform and Google Workspace, which are gaining momentum in the burgeoning cloud computing market.

Furthermore, Alphabet’s growing investments in infrastructure, security, data management, analytics, and artificial intelligence remain key developments in the metaverse space. GOOGL’s increasing efforts towards strengthening its presence in the burgeoning wearable space remain noteworthy.

Zacks ranked #3 Alphabet has an estimated revenue growth rate of 11.6% for the current year and 10% for the next. Zacks’ consensus estimate for this year and next year’s earnings have improved 0.2% and 0.2%, respectively, in the past 30 days.

Apple company (AAPL Free Report) encourages developers to use artificial intelligence and machine learning in their applications. AAPL’s focus on autonomous vehicles and augmented/virtual reality technologies presents an opportunity for long-term growth.

To ramp up its efforts, Apple has acquired several smaller companies with expertise in AR hardware, 3D games, and virtual reality software. These include SensoMotoric, Flyby Media, Emotient, TupleJump, Turi, Metaio, PrimeSense and Lattice Data Inc. In addition, AAPL’s ARKit helps third-party developers work on creating AR experiences for their iOS platform.

Zacks ranked #3 Apple has a growth rate of revenue and earnings per share of 4.5% and 6.2% respectively for the current year (ending September 2023). AAPL has outpaced earnings in each of the last four quarters reported.

Snap Inc. (Explode, Explode Free Report) to focus on developing augmented reality devices with Spectacle smart glasses. Adoption of the company’s AR lenses has been strong, particularly after the launch of Lens Studio 2. At the end of 2020, Snap launched its first-ever Landmarker Lens with 5G technology (a new augmented reality overlay tool for the world) in partnership with Verizon. The lens uses SNAP augmented reality technology and Verizon 5G Ultra-Wideband capabilities.

Strong adoption of products such as Scan and the AR Bar is driving the use of AR-based lenses, providing significant growth opportunities for SNAP. Moreover, the launch of the local lens, which enables shared and continuous AR experiences in much larger areas around the world, is expected to aid user engagement.

Snap Cartoon Lens powered by real-time machine learning has added to its portfolio. Furthermore, the launch of Music Lenses in Lens Explorer and Dynamic Lenses, which allow developers to bring real-time information from their apps to Snapchat Lenses, is a major incentive.

SNAP’s estimated revenue growth rate is 13.8% for the current year and 15.7% for next year. Zacks’ consensus estimate for current and next year’s earnings has improved 66.7% and 20%, respectively, in the past 30 days. Snap is rated Zacks #2 (Buy). you can see The full list of Zacks #1 stocks (strong buy) today is here.

Autodesk Corporation‘s (ADSK Free report) The business transition from perpetual licenses to cloud-based subscription services is expected to benefit the long-term. ADSK is well positioned to benefit from the rapid adoption of computer-aided design and manufacturing through its comprehensive product suite.

The growing demand for cloud-based products from Autodesk (BIM 360 cloud platform, Shotgun and Fusion Lifecycle), mobile products (AutoCAD 360) and design suites will drive higher growth. ADSK is also leveraging its investments in digital infrastructure, which includes its online store.

Zacks Ranked No. 3 Autodesk has estimated revenue and EPS growth rate of 14.3% and 30.2% respectively for the current year (ending January 2023). The Zacks consensus estimate for the current year has improved 1.5% in the past 60 days.

The chart below shows the price performance of the above five stocks since the beginning of the year.


Image source: Zacks Investment Research


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