LotRO All-Time Low, Gaming Stock All-Time Highs

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LotRO was affected by layoffs at Turbine this week, shrinking a small team even more. This was on the heels of an update to start the week, offering a new raid, many more housing hooks, and improved landscape visuals in classic areas of middle earth (see image).

The reactions to this update have been generally very favorable, judging by in-game chat and a shortage of complaints in the forums.

Speculation is rampant right now about LotRO’s future, so it’s best to just read the forum thread or the Massively article and comments. For now LotRO will continue, but the future of reaching Mordor is gloomier.

Turbine’s new DDO/LotRO double duty CM, Cordovan, had this to say in the forums this morning:

  • We appreciate everyone’s concerns for the team’s well-being, and know that folks have seen and read your thoughts. We aren’t able to comment specifically on personnel matters, especially when they come from business decision-making like this, but we would reiterate the part from yesterday’s official statement that Lord of the Rings Online will continue to operate as it does now. Additionally, we’d like you to know that our development plans remain unchanged.

So we’ll see.  I’m now at level 103 with my Warden main, maybe my favorite class ever in an MMO.


Video Game Stocks


This was a calm week following the Brexit chaos, with very strong manufacturing data (ISM number > 56) and jobs data for the U.S.. Weakness in oil and the British pound caused uncertainty, but some brief firming today (Friday) has the S&P index poised at the brink of all-time highs yet again.

If oil and currencies drop significantly over the weekend, we will almost surely reverse. We are also entering another earning season, and earnings will weigh heavily. This week analysts were saying this quarter will be a bottom for Apple (a former market leader), and to look to “dollar cost average” back into Apple stock going into the fall.

Analysts suggest the huge pain in the refiners (i.e. VLO, mentioned last week) is a canary in the coal mine for the economy, but this seems wrong since gas demand is strong, with record driving this summer. It’s more likely overcapacity (for reasons).

This week I was looking at GLU Mobile (GLUU), which is basing, having just released the Gordon Ramsey game with strong reviews and player enthusiasm, and having a strong cash position. They are also hiring heavily per their website.

The stock also seems to have huge insider buying in the last quarter, but I don’t understand the stock options. I do see a lot of GLUU buying by Tencent, the Chinese mobile game mega-corporation, which may get protectivist treatment from the recent Chinese game oversight regulations.

So I started looking at Tencent (TCEHY), which owns stakes in a lot of game companies as well as GLU Mobile and Blizzard. Tencent recently struck a big deal with ESPN, and is reporting strong results from the hookup. Disney (owner of ESPN) also has a Star Wars deal with Tencent.

Since I’ve given up on the Purefunds GAMR ETF as a way to diversify my investment in video games (due to extremely sketchy trading volume in that vehicle), I pushed a bit into Tencent instead on this big breakout day.

I also want more exposure to China, although the Chinese financial system is considered a ticking time bomb by some respected analysts, and a big cause of the big February selloff. The fears over Yuan currency, at least, are off the table lately, according to other analysts, and thus the calm and the market stability.

It’s not a good idea to buy on a big Friday up day, but Tencent is only at $23/share, after breaking out recently from $20, a resistance level dating back a year, then bouncing off of it. I see this stock having a lot of room to the upside, and I’m only in for “half”.

Other top gaming stock outperformers today, touching new highs, were Blizzard +2.2%, NVIDIA +3.9%, Electronic Arts +2.1%, Nintendo (NTDOY)  +10.2%. Nvidia, Intel, and Nintendo were specifically mentioned on CNBC this afternoon, Nintendo for the popularity of the new Pokemon Go.

As I reported last week, Overwatch is showing very strong momentum, but in general I don’t want to be speculating on individual game releases, hype, popularity, and sales. I’d need to be paid to make that amount of effort!

In the meantime, I’ll work overtime on my lousy low-paying job on a Saturday morning. Happy Friday!

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About Silverangel

https://kittykittyboomboom.wordpress.com/ View all posts by Silverangel

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