The term Metaverse has received lots of attention over the last few months, but what is it exactly? It is essentially a virtual online environment for anyone who read science-fiction books like Ready Player One or watched movies like The Matrix. Users can live, work, and play in it. The possibilities can be endless. More and more companies have begun investing in that space. Below are leading Metaverse stocks to keep an eye on.
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First, let’s talk about our first of the Metaverse stocks. Facebook changed its name to Meta Platforms in October 2021 to show how serious they are about virtual reality. In 2014, they bought Oculus, and today, their VR headsets outsell all other competitors.
Last year, the company spent $10B on developing the metaverse. Recent patents on users’ biometric data ensure that the avatars are as realistic as possible. In August 2021, Meta Platforms took the work-from-home trend to a different level. Thanks to Oculus, they built the Horizon Workrooms application.
Users can participate in work meetings via the app. Everything from a conventional office is available, from the keyboard to the whiteboard.
Meta makes most of its revenue from advertisements through its social media platforms (Facebook, Whatsapp, Instagram).
1. Meta Platforms Inc. (NASDAQ: META)
The probability that those same personalized ads will appear on their VR platform is quite high. On February 3rd, Meta stock plummeted by 25% to $240 due to a loss of monthly active users for the first time and disappointing earnings and guidance for the upcoming year.
Will it bounce back with its investment into the metaverse? Time will tell, but if more people are seeking out VR, it can be a good investment opportunity.
2. Microsoft (NASDAQ: MSFT)
Microsoft has also been very busy with its metaverse stocks investments. Earlier this year, they bought video game giant Activision Blizzard Inc. for a whopping $69B.
Activision makes Call of Duty, World of Warcraft, Guitar Hero, Overwatch, and many other international best-selling video games.
The plan is clear. Integrate video games with virtual reality. Combining with Xbox to bring the best possible video games is only a few months away.
On top of that, the Microsoft 365 software suite also offers virtual work environments via Microsoft Dynamics 365 – Connected Spaces, just like Meta does.
Microsoft users won’t have to switch to a competitor when it can be integrated into the existing software. The application can also be used on the Meta Oculus VR headset.
Microsoft’s target audience isn’t social media users but corporations and gamers. Instead of investing in a new technology, they are upgrading theirs and buying existing market share. Hence, their stock price did not take as big a hit as Meta’s. They are currently sitting at $307, not too far from their all-time high of $349.67 set at the end of December 2021.
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3. Roblox Corp (NYSE: RBLX)
Roblox is the closest thing to an online metaverse platform, hence why they’re on our Metaverse stocks list. The platform partners with outside developers to build games for its users. They recently acquired the platform Guilded, which connects various gaming communities.
Half its users are below 13, but adults also partake in the experiences. They currently have almost 50M daily active users. That number is constantly growing. Artists like Tai Verdes and Lil Nas X also hosted virtual concerts during the pandemic.
This can allow fans worldwide to attend a virtual show of their favorite artists. Some viewers live in areas that performers never visit. Now, they can virtually participate. Roblox also partnered with Forever 21, Nike, and Ralph Lauren to promote their brands on the platform and create and sell their merchandise.
Roblox generates revenue by selling its virtual currency to platform users. They can use this currency to participate in various online activities. If Roblox can keep its existing young clients and appeal to the older generations, its growth can be exponential. Their revenues are growing quarterly, but their stock has dropped since its all-time high in November 2021. They are currently at $63.73, over 50% down from their $141 high.
4. Unity Software Inc (NYSE: U)
Unity Software’s business model allows them to profit from the metaverse differently. They are the leaders in the 2D and 3D software space. They are responsible for 71% of the top 1,000 mobile games, and more than 50% of games across all platforms use their code. As more metaverse content will be created, Unity will most likely have a big role in the visual aspect.
Unity’s platform allows everyday people to create a 2D and 3D world free of charge. Users who like the platform can upgrade to the paid version. Users can then create video games and applications to monetize their efforts eventually. Thanks to its SaaS (subscription-as-a-service) model, Unity gets some of the revenues. Anyone can create movie-grade characters on their platform, thanks to their recent acquisitions.
Unity is not yet profitable. But this metaverse stocks list stock is heading in the right direction. Their revenues are increasing while their losses are decreasing. Profitability should be just around the corner for them. Their stock is currently at $108.66, halfway down from their all-time high of $210 set in November 2021.
Nvidia ($NVDA) TipRanks Stock Forecast Report 3/24
ETF for Metaverse Stocks
Finally, we will talk about a unique ETF. For those who don’t want to invest in a unique company and want broader exposure, Roundhill Ball Metaverse ETF (NYSEMKT: META) is here for you. This ETF comes with a 0.75% expense ratio and has over $800M worth of assets under management. It is the first index to track companies in the metaverse market.
Some of the companies outlined in this article are part of this ETF. Here is the breakdown of the top 10 holdings.
- Nvidia Corporation – 8.47%
- Microsoft Corp – 7.46%
- Meta Platforms Inc – 7.08%
- Roblox Corp – 5.41%
- Unity Software Inc – 4.56%
- Apple Inc – 4.51%
- Taiwan Semiconductors – 4.49%
- Qualcomm Inc – 4.10%
- Autodesk Inc – 3.95%
- Amazon Com Inc – 3.73%
This ETF allows investors to take a stake in major tech companies. 20% of this ETF is invested outside of the US. It has not been performing very well since its inception. This is still quite a new industry, and there is still much room to grow in the upcoming years and decades.
Chipmakers of Metaverse Stocks
Chipmakers like Nvidia Corp (NASDAQ: NVDA) and Qualcomm Inc. (NASDAQ: QCOM) have a unique role as technology evolves. Complex calculations on computers require the best chips. With their current status, these two companies are well-positioned to supply the abovementioned companies with much-needed chips. A worldwide shortage of chips makes the coming years even more important.
Strategic partnerships with aspiring leaders in the metaverse will be essential. Qualcomm signed a collaboration with Microsoft. This ensures a supply of high-end chips and the necessary funding to meet the demand.
NFTs
Many metaverse stock companies will take the opportunity to sell NFTs on their platforms. The same technology behind Bitcoin and other cryptos will be used in the metaverse.
More and more people want to own virtual, unique property online. NFTs can range from tokens to actual land.
A good example is Decentraland. It is the most popular place to buy land and other items via the MANA cryptocurrency. A fashion show by Adidas recently took place in Decentraland to promote their fashion designs as NFTs. The possibilities are endless with NFTs in a virtual world.
Final Thoughts: Metaverse Stocks
To conclude, metaverse stocks are very diversified. Investors can choose between companies innovating in the actual metaverse, graphics, or the hardware behind the technology. This market is very young and has a lot of potential. Companies that can uniquely monetize their brand will come on top.
If you want to learn more about how to profit from the stock market, head over to our free library of educational courses. We have something for everyone, including trading options for those with small accounts.
Frequently Asked Questions
- (META) Meta Platforms: $370.40/share
- (MSFT)Microsoft: $391.63/share
- (U) Unity Software: $34.09/share
- (SNAP) Snap: $15.61
Yes, you can buy stocks in companies involved in its development. To do this, you can invest in these stocks in the same way as regular stocks. Some companies that are potential metaverse investments include Meta Platforms Inc. (META), Roblox Corp. (RBLX), Nvidia Corp. (NVDA), Unity Software Inc. (U), and Microsoft Corp. (MSFT). If you prefer, you can also purchase metaverse ETFs. Currently, there are six ETFs available in the U.S. that will give you exposure to the "metaverse."
Many of the largest metaverse companies are tech stocks and typically have high growth potential. Many think the metaverse could be worth over $1 trillion by 2030. Because of this, investing in the metaverse likely is a good idea.
In the realm of the metaverse, Meta Platforms (NASDAQ: META) is a leading stock that outshines its competitors. This is mainly due to the substantial investment the company has made in virtual reality (VR) and augmented reality (AR). As a result, Meta has firmly established itself as a frontrunner in the metaverse industry. Interestingly, Meta's stock market performance in 2023 and 2024 surpassed that of Amazon's.
There are a variety of options available for U.S. metaverse investments, including exchange-traded funds (ETFs), metaverse properties (metaverse real estate), investment funds and metaverse company (metaverse) shares. Major players in the market today include Facebook (FB), Google (GOOG), Microsoft (MSFT), Epic Games (EG), and Magic Leap.
