TTWO and EA tend to outperform in August
One video game stock that investors should keep their eyes on is Take-Two Interactive Software, Inc (NASDAQ:TTWO), especially after the company's earnings beat earlier this week. The equity was last seen up 0.9% to trade at $177.66, just a chip-shot away from its August 4 all-time high of $180.61. Even better news, the stock just entered a historically bullish month.
In fact, the security just landed on Schaeffer's Senior Quantitative Analyst Rocky White's list of best stocks to own in August over the past 10 years. During this 10-year period, TTWO averaged a one-month return of 5.5%, with 70% of theses returns positive. A move of similar magnitude would put the equity at a new record high of $187.43. Longer term, Take-Two Interactive stock is up over 75% since its March lows near the $100 level, with an early June pullback contained by the 60-day moving average.
Take-Two isn't the only video game stock to make the list. Sector peer Electronic Arts Inc. (NASDAQ:EA), boasts an average August return of 2.5% during the past 10 years, with 70% of the returns positive. From its current perch of $146.92, a similar move would put the security at $150.59 -- a hair's breadth away from its July 13, 2018, all-time peak of $151.26. The equity boasts an impressive 58.6% year-over-year lead, with the 30-day acting as a solid level of support since April.
That being said, now looks like an excellent time to speculate on EA's next move with options. The stock's Schaeffer's Volatility Index (SVI) of 30% sits higher than just 16% of all comparable readings from the past year. In other words, the options market is pricing in relatively low short-term volatility expectations at the moment.