The AGEM Index has presented its numbers for April and the results show a significant rebound in certain gaming stocks. While the gaming world suffers at the hands of the coronavirus, the index actually saw a substantial increase in performance compared to March. There is still a lot of work to be done, but the gains indicate that investors are starting to feel good once again with gaming stocks, and are willing to direct more of their funds to companies operating in the space. Of course, it doesn’t hurt that stocks took a nosedive in February and March, so investing more now will lead to greater returns.
The AGEM (Association of Gaming Equipment Manufacturers) Index, which tracks 13 gaming firms, improved by 20.3% from March to April, gaining a total of 63.52 points as it made its way to the month-end close of 376.04 points. This followed a 33.4% drop that had been seen from February to March, indicating “significant stock price increases as global markets began to rebound from the shocks due to the Covid-19 pandemic,” per the index’s creator, the Association of Gaming Equipment Manufacturers (AGEM).
Compared to a year earlier, though, the April performance was 21.1% lower. This means that the gaming industry still has a ways to go before it can say that it has recovered, but at least things are moving in the right direction. AGEM added that “all three major U.S. stock indices increased as the Dow Jones Industrial Average and the S&P 500 experienced monthly gains of 11.1 percent and 12.7 percent, respectively. The Nasdaq also experienced a gain of 15.5 percent.”
Looking at individual performances of a few companies in the Index, Aristocrat Leisure saw an increase of 19.4% from March to April, but its year-on-year result was a drop of 2.3%. International Game Technology watched as its stock moved up 26.7% from one month to the next, but has to be disappointed in the overall 48.5% drop it has seen from April 2019 to last month. TransAct Technologies, which specializes in player and food safety management software, reports a month-over-month increase of 36.7%, offset by a year-on-year decrease of 54.9%.
Companies need assistance to survive the chaos caused by COVID-19, and governments, and even big business, have been stepping in to lend a hand. TransAct has been able to take advantage of the U.S. CARES Act (the Coronavirus Aid, Relief, and Economic Security Act) to receive much-needed funds. It reports that it has been given a $2.2-million loan, which will “help the company maintain its operations and meet its payroll obligations in this time of unprecedented uncertainty, related to the impact that the novel coronavirus (Covid-19) pandemic is having on the food service and casino industries,” according to a statement. The company has already had to furlough some of its staff, and the current economic stress follows a 2019 that saw it report a 91% drop in profit.