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Frontier Developments' investments are well placed to pay off

The video games developer has laid the foundations for significant growth over the next few years
Frontier Developments' investments are well placed to pay off

Investors should not see gaming companies as short-term beneficiaries of economic lockdowns. Good companies with the right strategies are tapping into a long-term growth market that has potential to keep on rewarding shareholders.

The success of Games Workshop (GAW) has shown the potential of gaming companies to be outstanding investments that keep on delivering. The company is somewhat unique in that it sells table-top games and does not face huge amounts of competition.

Computer gaming is a different market altogether. Competition is intense and barriers to entry in areas such as mobile gaming is low. Developing a game that can stand the test of time and deliver lots of profits and cash flow is no easy task, but Cambridge based Frontier Developments looks like it has found a winning formula here.

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