HomeResearchGrow Rich from One of the World’s Newest Obsessions

Grow Rich from One of the World’s Newest Obsessions

Grow Rich from One of the World’s Newest Obsessions

In 1996, Warren Buffett’s annual shareholder letter outlined a type of company he labelled “the Inevitables.”

The name indicated companies that were so solid they would still be the top player in their market in thirty years.

Buffett’s list of Inevitables included cigarette manufacturers such as Altria and Phillip Morris. “I’ll tell you why I like the cigarette business,” he said, “…they’re addictive.”

Buffett strongly believes that companies that cater to habit-forming tendencies inevitably outperform in all markets.

Take Starbucks, for example. Even though the Katusa office brews its own Costco drip coffee, employees still fork over a few bucks every day for that jolt of espresso.

That daily habit brought Starbucks from $4 a share in 2009 to just under $90 recently. That’s a 2,250% rise in a single decade…

SB Share Price

New inevitables like Starbucks, Coca-Cola, and Netflix don’t come along very often.

But there’s a compelling new investment sector that has everything necessary to be the next Inevitable.

The Next Generation’s Biggest Obsession Isn’t Vaping

The next big habit is already so bad that China implemented severe restrictions on it for minors.

Officials limited how much they can use it, and how much money they can spend on it.

The biggest obsession of the 2020s is something you probably didn’t expect: video games and esports.

Remember, Warren Buffett made his list of inevitables about addictiveness.

In fact, he made a billion-dollar bet on Coca-Cola partially due to the addictiveness of sugar.

For gamers, video games and their communities are the sugar. They’re designed to keep people coming back again and again.

And they’re extremely effective at it.

Gamers help the entire gaming industry generate over $150 billion per year in revenue.

And that’s projected to top $200 billion in 2022.

Let’s give that a little perspective:

  • Apple made “only” $52 billion off of iPhones in 2018.
  • The video games industry has more annual revenue than McDonald’s, Delta Air Lines, American Express, and Anheuser-Busch—combined.

Another “sweet treat” that keeps gamers coming back for more is esports. That’s where gamers watch professional gamers compete against each other.

They watch live in real sports stadiums, as well as through online streams on their devices around the world.

By mid-2020, esports will be chasing the NFL for the top spot in viewership in the United States, as seen below.

Estimated US Viewership

There are very few opportunities where you can get investment exposure to the lucrative new world of online video gaming communities.

Not to mention direct ownership of the booming esports sector.

The Katusa Research Special Situations team has identified an Inevitable that ticks all of those boxes…

Introducing Enthusiast Gaming (EGLX:TSX)

The key to being an Inevitable is absolute industry dominance of an addictive product.

And Enthusiast Gaming has taken over the video game community industry in the United States—and around the world.

  • The EGLX network is now ranked by Comscore as the largest gaming network in the U.S.

That beats out other leading gaming websites such as Amazon-owned Twitch and IGN.

It’s absolutely mindboggling how much traffic the EGLX network gets:

  • It generates almost 1 billion total views a month over its entire network…
  • It reaches far more combined unique visitors across all platforms than any other gaming entity in each market… almost 44% greater than the next entity in the U.S. and 102% greater than in the U.K.
The company has five primary catalysts that could make it a dominant player in the video game for the next three decades—and beyond.
  1. EGLX Ownership – EGLX’s Chairman also owns a professional sports team and a 19,000-seat stadium. That’s like Coca-Cola also owning McDonald’s—it’s an effectively free distribution channel. There are many synergies to be explored here…
  2. Esports Team Valuation Growth – We deliberately sandbagged the value of EGLX’s esports team’s growth for our valuation model. The media rights per viewer are currently just a fraction of what NFL and others sports are… this will change.
  3. Esports Brand Helping Ad Sales – The esports brand has an additional 40 million followers that can be bolted onto its strong advertising arm. This will allow companies to promote their products across Enthusiast websites, teams, and athletes/influencers. It’s an incredible triple threat.
  4. Ads Helping Esports Brand – EGLX can help build brand awareness for their esports division team across Enthusiast’s vast network of 200M+ monthly users.
  5. Accelerated Direct Sales – We were very conservative in our valuation with the growth of Enthusiast’s direct sales channels. If they execute as planned, there could be huge upside to their advertising network.
EGLX is the only vertically integrated, all-in-one gaming entertainment company that can provide both its own platform and its own content—and promote it virtually for free.Profiting from the Explosion of Digital Traffic iPad Mockup
To view our full report on Enthusiast Gaming (EGLX:TSX) The World of Digital Alchemy: Profiting from the Explosion of Digital Traffic and the booming traffic around the online video game industry, click here.

Because you’re a member of Katusa’s Investment Insights, this detailed report is free exclusively for you. To access your free report and our full analysis on the video game sector, click here.

Regards,

The Katusa Research Team

DISCLOSURES AND DISCLAIMERS

Katusa Research and its directors, employees and members of their households indirectly own shares of the following Companies which are described in this publication: none.

Katusa Research receives cash compensation with the following companies which are mentioned in this publication: Enthusiast Gaming (EGLX). Therefore, the company mentioned is a sponsor of this publication. From time to time, Katusa Research and its directors, officers, employees or members of their immediate families, as well as persons interviewed for articles and interviews on KatusaResearch.com, may have a long or short position in securities mentioned. Therefore, Katusa Research is extremely biased. Katusa Research and its officers, directors and employees are not a securities service provider, investment advisor or registered broker according to the CSA or SEC.

All publications from Katusa Research including those on KatusaResearch.com or affiliate sites are neither financial analysis nor are they equal to a professional financial analysis. Instead, all publications from Katusa Research are exclusively for informational and entertainment purposes only and are expressively not trading recommendations regarding the buying or selling of securities.

All publications of Katusa Research represent only the opinion of the respective authors.

This report is neither explicitly nor implicitly to be understood as guarantee of a particular price development of the mentioned financial instruments or as a trading invitation. Every investment in securities mentioned in publications of Katusa Research involve risks which could lead to a total loss of the invested capital and—depending on the investment—to further obligations for example additional payment liabilities.

The information in the publications of Katusa Research do not replace and are not to be taken as individual needs geared professional investment advice. In spite of careful research, neither the respective authors nor Katusa Research will guarantee or assume liability for actuality, correctness, mistakes, accuracy, completeness, adequacy or quality of the presented information. Katusa Research is not responsible for your losses. It’s your money and your responsibility. The same shall apply for all presentations, numbers, designs and assessments expressed in interviews and videos.

Our views and opinions in this report are our own views and are based on information that we have received, which we assumed to be reliable. We do not guarantee that any of the companies mentioned in this newsletter will perform as we expect, and any comparisons we have made to other companies may not be valid or come into effect. All information published in publications from Katusa Research is based on public filings and news releases.

Katusa Research and the respective authors are not obliged to update information in publications. Katusa Research and the respective authors explicitly point out that changes in the used and underlying data, facts, as well as in the estimates could have an impact on the target share price or the overall estimate of the discussed security.

Katusa Research is not responsible for consequences especially losses, which arise or could arise by the use or the failure of the application of the views and conclusions in the publications. Katusa Research and the respective authors do not guarantee that the expected profits or mentioned share prices will be achieved.

The reader is strongly encouraged to examine all assertions him/herself. An investment, presented by Katusa Research and the respective authors in partly very speculative shares and financial products should not be made without reading the most current balance sheets as well as assets and liabilities reports of the company.

The use of any publication of Katusa Research is intended for private use only. New Era Publishing Inc. shall be notified in advance or asked for permission if the publications will be used professionally which will be charged. All information from third parties especially the estimates provided by external users does not reflect the opinion of Katusa Research. Consequently, Katusa Research does not guarantee the actuality, correctness, mistakes, accuracy, completeness, adequacy or quality of the information.

Katusa Research cannot rule out that other market letters, media or research companies are discussing concurrently the shares, companies and financial products which are presented in all publications of Katusa Research. This can lead to symmetrical information and opinion generation during that time period. No guarantee is given for the accuracy of charts and data to the commodity, currency and stock markets presented in all publications of Katusa Research.