The video game industry had a rough outing in 2022 from a perfect storm of macroeconomic headwinds. But leading game makers are continuing to reach new audiences with greater gameplay realism and features that make it easier to play with friends online. The industry is poised to return to growth over the next year, and that spells good return potential for shareholders of leading brands.

If you're interested in buying shares of a gaming stock this month, here's why Electronic Arts (EA 1.43%) and Corsair Gaming (CRSR 1.55%) should be at the top of your list.

Electronic Arts

Shares of Electronic Arts fell after the video game maker reported strong growth in its fiscal 2024's first quarter (ended in March). The stock still looks like a solid investment based on current momentum from top titles and future opportunities with the company's deep game development pipeline.

Net bookings, or adjusted revenue, grew an impressive 21% year over year. The growth was driven by strong sales of Star Wars: Jedi Survivor and accelerating sales of FIFA 23. This puts the company in a solid position to capitalize on momentum with the upcoming release of the EA Sports FC title this fall, following EA's loss of the branding rights with FIFA.

EA won't keep growing at these rates every quarter. The reason the stock fell after the earnings news was management's forward bookings guidance. The company expects full-year bookings to improve to between $7.3 billion to $7.7 billion, which is a small increase over fiscal 2023's $7.3 billion. 

However, the company has a strong development pipeline of new games coming that should drive satisfactory growth and returns for investors. It's set to add another staple title to its EA Sports roster with the return of its college football franchise next year. While it may not outsell Madden, it will pad the company's financials results as there should be plenty of pent-up demand after a decade-long absence since EA's NCAA Football franchise was discontinued over a licensing issue.

The company is also working on two Marvel games in collaboration with Walt Disney, including action-adventure games based on the Iron Man and Black Panther franchises. Action-hero games have been hit or miss from other game companies, but that's usually due to their overly simplistic gameplay and storylines that don't give the player much freedom to explore. The early buzz is that these new superhero games from EA will be open-world role-playing games, which is a popular genre and should widen their sales potential.

Another broader initiative that EA is investing in is providing more features that help players connect with friends and build communities in its sports titles. This keeps players engaged, spending more time playing matches with others, which naturally leads to higher in-game spending on extra content. EA's soccer franchise already has a community of over 150 million players -- and growing. 

The stock seems more than reasonably valued ahead of these opportunities, trading at a forward price-to-earnings (P/E) ratio of 20, which is a discount to the S&P 500 multiple of 26.

Corsair Gaming

Shares of Corsair Gaming are up 15% over the past year but still trading well off their previous peak. The company supplies essential gaming gear for players, including peripherals and computer parts for building gaming PCs.

As more players pick up the hobby, it naturally helps drive up demand for accessories, like game controllers, headsets, and other gaming peripherals. It also pushes PC gamers to upgrade their machines to keep up with the higher demands that the latest games put on a computer's processing and storage capabilities.

In the peripherals market, Corsair faces stiff competition from the likes of Logitech International and many other brands. But Corsair is one of the most popular brands of gaming mice and keyboards. The company distinguishes itself by focusing on the premium end of the market.  

Most of the company's revenue comes from hardware components and memory chips that gamers use when building or upgrading their own gaming PCs. Corsair is the leader in these markets. Earlier this year, management reported more players in major markets building PCs than before the pandemic, which is a good indicator that Corsair's competitive position is holding strong and positioning the business for a return to growth.

It seems to be turning the corner already. Corsair just reported a 15% year-over-year increase in revenue for the second quarter. On top of improving revenue trends, inventory has come down and profits are improving. In the first half of 2023, adjusted profit was $22 million, reversing the net loss a year ago.

The global market for gaming peripherals is projected to grow 10% per year to reach $7.5 billion by 2028, according to Expert Market Research. As a leading brand, Corsair should be able to grow its game and peripherals segment consistent with the industry.

As for the rest of the business, the global pool of PC players has been gradually rising for many years and provides a built-in growth market for Corsair's components and memory segment.

The stock's forward P/E of 30 looks expensive, but Corsair is a better value than it appears at first glance. As margins rise from leaner inventory and demand for its products returns, earnings per share could grow at high double-digit rates and support a big rally in the stock over the next few years.