Today’s article introduces three virtual reality stocks to buy. Once relegated to science fiction, VR is rapidly transforming from a futuristic concept to a tangible reality. Advancements in hardware, such as Apple‘s (NASDAQ:AAPL) Vision Pro and Meta Platform‘s (NASDAQ:META) Meta Quest 3, have greatly improved user experience and accessibility. After decades of anticipation, VR is finally delivering on its promise of immersive entertainment and revolutionizing various sectors, including healthcare with VR-assisted surgery training, education with virtual field trips, and defense with immersive simulations.
According to a report by Grand View Research, the global VR market, valued at around $59.96 billion in 2022, is projected to grow at a robust compound annual growth rate (CAGR) of 27.5% from 2023 to 2030. With that said, here are three virtual reality stocks to buy, each with distinct catalysts poised to propel their growth.
Matterport (MTTR)
First up on our virtual reality stocks to buy is Matterport (NASDAQ:MTTR), a pioneer in the spatial data sector. The company is renowned for creating immersive 3D models of real-world spaces. In addition to revolutionizing the real estate industry with digital twins, Matterport’s 3D capture technology finds applications in architecture, engineering, and facilities management, offering solutions for capturing and managing spatial data.
On February 20, Matterport announced fourth-quarter and full-year financial results, showcasing a notable 56% year-over-year (YoY) decrease in its net quarterly loss to $11.8 million. Despite missing revenue estimates, the company demonstrated financial strength and growth. Investors noted its debt-free status as well as the significant expansion in its subscription segment and annual recurring revenues (ARRs).
Meanwhile, Matterport is also expanding its footprint through strategic partnerships with industry leaders like Arcadus and the Ivy Collection, highlighting the versatility of its 3D capture technology. Moreover, the recent launch of the AI-powered Property Intelligence platform, a real estate program automating room measurements, further enhances its competitive edge.
Despite a 27% year-to-date (YTD) decline in MTTR stock, the average analysts’ price target stands at $3, suggesting a potential 42% upside from the current levels. Readers may be interested to know that shares currently trade at 3.6 times trailing sales and a price-to-book (P/B) ratio of 1.2.
Microsoft (MSFT)
The next company on our list of virtual reality stocks to buy is Microsoft (NASDAQ:MSFT). Through initiatives like Microsoft Mesh, the tech giant enables shared collaborative and holographic experiences in mixed reality (MR). Similarly, Microsoft HoloLens, an MR head-mounted display unit, offers users highly immersive experiences with spatial audio and advanced interaction capabilities.
Management announced second quarter results for FY 2024 on 30 January. Revenue came in at $62.0 billion, was up 16% YoY. Diluted earnings per share (EPS) was $2.93 up 23% YoY. In addition, the company returned $8.4 billion to shareholders in the form of share repurchases and dividends.
Microsoft stock is up 8% YTD and hovering at all-time highs. The shares are changing hands at almost 37 times trailing earnings and 13.5 times sales. While the stocks seems overpriced with these metrics, the 12 month average price forecast stands at $465 with an upside potential of more than 15%.
Sony (SONY)
The final company among our virtual reality stocks to buy is Sony (NYSE:SONY), which drives innovation through developments in both hardware and software. The company’s PlayStation VR2 headset boasts high-fidelity displays, advanced haptics, and intuitive controllers, providing users with immersive and engaging gameplay experiences. Looking beyond the realm of gaming, Sony is developing a “spatial content creation” system that allows users to edit and manipulate 3D models while wearing a VR headset.
The electronics giant announced its fiscal year 2023 third quarter results in mid-February. Revenues went up by 22% YoY, while sales for the “Game & Network Services Segment” increased by 13%.
Yet, despite the promising developments in immersive technologies, SONY stock is down 9.38% YTD. Meanwhile, the shares are trading at close to 19 times trialing earnings and 1.2 times sales. Finally, the 12-month median price forecast for Sony stock stands at $108.17, offering a 26.05% upside potential from current levels.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines