​​​Best metaverse stocks to watch

Understanding the metaverse and its investment potential

​The metaverse is an emerging concept that represents the next evolution of the internet. It's a persistent, shared, 3D virtual universe that aims to seamlessly blend our digital and physical worlds. As major tech companies invest billions into developing this revolutionary technology, investors are increasingly looking to capitalise on its potential.

​The metaverse market is projected to grow significantly in the coming years. According to a report by Precedence Research, the global metaverse market size is expected to reach $1,607.12 billion by 2030, growing at a compound annual growth rate (CAGR) of 50.74% from 2022 to 2030.

​This rapid growth presents a unique opportunity for investors to get in on the ground floor of a potentially transformative technology. By investing in metaverse stocks, you can potentially benefit from the long-term growth of this emerging sector.

​However, it's important to note that investing in metaverse stocks, like any investment, carries risks. The technology is still in its early stages, and the full potential of the metaverse is yet to be realised. As with any investment decision, it's crucial to conduct thorough research and consider seeking advice from a financial professional.

Meta Platforms: Pioneering the metaverse revolution

Meta Platforms, formerly known as Facebook, has positioned itself at the forefront of the metaverse revolution. The company's rebranding in 2021 signalled its commitment to building and shaping the future of virtual reality (VR) and augmented reality (AR) technologies.

​With a market capitalisation of nearly $1.3 trillion, Meta has the financial resources to make significant investments in metaverse technologies. The company owns Oculus, a leading VR headset manufacturer, which gives it a strong foothold in the hardware aspect of the metaverse.

​Meta has also introduced Horizon Worlds, a social metaverse platform that allows users to create and explore virtual spaces. This platform serves as a testing ground for the company's vision of the metaverse and provides valuable insights into user behaviour and preferences.

​However, Meta's journey into the metaverse hasn't been without challenges. The company has faced scrutiny over privacy concerns and the potential social impact of its technologies. Despite these hurdles, Meta remains committed to its metaverse vision, making it a stock to watch for investors interested in this emerging sector.

​The sharp 480% ascent in the Meta share price from its November 2022 low to its $531.49 April 2024 high has been followed by range trading around the $500 mark since then without making any major additional gains. Nonetheless, the near two-year uptrend remains intact.

Microsoft: Integrating the metaverse into enterprise and gaming

Microsoft, with its over $3 trillion market valuation, is making significant strides in the metaverse space. The company's approach focuses on integrating metaverse technologies into both enterprise and consumer markets, leveraging its strong position in cloud computing and gaming.

Microsoft's Mesh platform is a key component of its metaverse strategy. Mesh is a mixed-reality platform that enables presence and shared experiences from anywhere – on any device – through mixed reality applications. This technology has the potential to revolutionise remote collaboration and virtual meetings.

​In the hardware space, Microsoft's HoloLens, an AR headset, is already being used in various industries for training, remote assistance, and design visualisation. The company's acquisition of Activision Blizzard for nearly $70 billion further strengthens its position in the gaming aspect of the metaverse.

​Microsoft's Azure cloud services provide the infrastructure backbone for many metaverse applications, positioning the company as a key player in the development of the metaverse. This multi-faceted approach to the metaverse makes Microsoft a compelling stock for investors looking to capitalise on this trend.

​The Microsoft share price bull market remains valid but a fall through its near two-year uptrend line and, more importantly, its $385.58 August low could lead to the November 2021 high at $349.67 being revisited. Were this to happen, a better long-term investment opportunity would present itself for buying Microsoft stock.

NVIDIA: Powering the infrastructure of the metaverse

NVIDIA, with a market capitalisation of over $2.6 trillion, is playing a crucial role in building the infrastructure that will power the metaverse. The company is the leading designer of high-end graphics processing units (GPUs) and AI accelerators, which are essential for rendering complex 3D environments and processing vast amounts of data in real-time.

​NVIDIA's Omniverse platform is a key offering in the metaverse space. It's a scalable, multi-GPU real-time reference development platform for 3D simulation and design collaboration. This platform is already being used by major companies for virtual world creation and simulation.

​The company's acquisition of ARM Holdings for $40 billion (although the deal was later cancelled) demonstrated its commitment to expanding its capabilities in creating virtual world computing technology. NVIDIA's strong position in both hardware and software makes it a central player in the development of the metaverse.

​As the metaverse grows and demands more computing power, NVIDIA is well-positioned to benefit from increased demand for its products and services. This makes it an attractive option for investors looking to invest in the foundational technology of the metaverse.

​The steep NVIDIA 2022-to-2024 uptrend and over 1,100% rise from its $10.81 October 2022 low to its $140.76 June 2024 high remains intact but a fall through it and the $90.69 August low could lead to a medium-term correction, potentially providing investors with better entry levels to buy the chip maker’s shares.

Unity Software: Empowering metaverse content creation

Unity Software, with a market capitalisation of around $6.5 billion, is a key player in the content creation aspect of the metaverse. The company's Unity engine is used to develop over 50% of all mobile, VR, and AR games and applications, making it a crucial tool for metaverse content creators.

​Unity's technology extends beyond gaming and is increasingly being used in industries such as architecture, engineering, and film production for creating immersive 3D environments. This versatility positions Unity well for the diverse applications of the metaverse.

​The company has also been making strategic moves to strengthen its position in the metaverse. In 2023, Unity acquired Ziva Dynamics, a company specialising in 3D character creation, further enhancing its capabilities in creating realistic virtual beings for the metaverse.

​While Unity faces competition from other game engines and 3D creation tools, its widespread adoption and continuous innovation make it a stock to watch in the metaverse space. As the demand for 3D content creation tools grows with the metaverse, Unity could see significant growth opportunities.

​From its November 2021 lofty heights at $210.00, the Unity Software share price has been tumbling by over 90%, so far to its August 2024 low at $13.90, but at these levels may long-term prove to be a bargain. For now, the long-term trend is still pointing down, though.

Autodesk: Building the foundations of virtual worlds

Autodesk, with a market capitalisation of nearly $55 billion, is a global leader in 3D design, engineering, and entertainment software. Its suite of tools, including AutoCAD, Maya, and Revit, are widely used for designing both physical and digital worlds, making it a key player in the development of metaverse environments.

​As the metaverse evolves, the demand for sophisticated 3D modelling and design tools is expected to increase. Autodesk's software is already being used to create complex 3D environments, avatars, and objects that could form the building blocks of virtual worlds.

​The company has also been investing in cloud-based collaboration tools, which align well with the collaborative nature of the metaverse. Autodesk's Forge platform, for instance, allows developers to create applications that can visualise 3D models in real-time, a capability that could be crucial for metaverse applications.

​While Autodesk may not be as directly associated with the metaverse as some other companies, its fundamental role in 3D design and modelling makes it a potentially safer bet for investors looking to benefit from the growth of the metaverse.

​The Autodesk long-term uptrend, though less steep than that of most of its larger cap peers, looks to be more solid for exactly that reason. Its long-term bullish trend will remain intact while the May 2024 low at $195.32 underpins.

The Metaverse: still in its infancy

​The Metaverse mega-trend is still in its early innings, so the time might be ripe for investors to add top metaverse stocks like these for the long haul. These large cap stocks all have the financial fortitude, key technologies, and strategic visions to help shape the Metaverse and reward shareholders. As the virtual universe unfolds, these stocks are primed to be potential winners.

​Remember, while these stocks show promise in the metaverse sector, it's crucial to conduct thorough research and consider your personal financial situation before making any investment decisions. You may want to consider opening a share dealing account to start trading these stocks, or try out strategies risk-free with a demo account. Always ensure you understand the risks involved in share trading before committing capital.

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