Top 10 NFT Stocks to Watch Right Now

Curious about NFTs but don’t know where to start? It’s the idea that NFTs are overpriced, or that they lack utility. This may explain why some are on the fence about buying into NFTs. If that’s the case for you, you might want to try investing in NFT stocks to test the investment waters.

See: 3 Things You Must Do When Your Savings Hit $50,000

Take a look at these top NFT stocks to help you get started.

What does NFT stand for?

NFT is short for non-fungible token. These digital assets can represent ownership of almost anything, including:

NFTs were first introduced in 2014 when the shift towards cryptocurrency opened the door to investing in digital assets. They are an increasingly popular investment option today. What sets them apart from other investments is that each NFT is unique.

10 NFT stocks to invest in

If you think NFTs show promise as an investment, but you’re not ready to buy individual tokens, consider investing in NFT stocks. Although you cannot buy shares in NFTs themselves, you can buy shares in companies involved in NFT creation, trading or technology. Here’s a look at 10 of the best NFT stocks you should consider investing in right now.

1. Dolphin Entertainment (DLPN)

This development company handles entertainment marketing and premium content. Its subsidiaries include 42West, The Door, Viewpoint Creative and Shore Fire Media.

Its focus on the digital realm makes it worth considering if you’re interested in NFTs, especially since its flagship NFT collection, Creature Chronicles, completely sold out in less than two hours after launch.

The company reported a slight year-over-year increase in revenue in the third quarter of 2022. Although it had lost money the previous quarter – and is feeling the effects of the FTX collapse, like other FTX partners – it has an analyst price target of almost 300% above today’s share price of $2.10 as of February 10. Analysts expect Dolphin to become profitable in 2023.

2. eBay (EBAY)

EBay makes the list as one of the most well-known brands – and is without a doubt a household name. It is also a relevant investment option due to its expertise in e-commerce.

The company has allowed customers to buy and sell NFTs on the eBay site since May 2021. And last June, it announced that it had acquired KnownOrigin, a leading NFT marketplace, in a deal that could help eBay position itself as a top site for NFT collectors.

EBay also cultivates its own exclusive NFTs. One example is a canvas created in collaboration with Kayvon Thibodeaux, a football player for the Oregon Ducks.

While not all analysts agree with the current “buy” consensus reported by Yahoo Finance, some attribute weak stock prices to consumers’ inevitable return to pre-pandemic shopping habits. The company recently implemented guarantees of authenticity as well as changes in payments, advertising and other areas that could boost revenue this year, reported Bloomberg, which included eBay on its 2023 watch list.

3. Cloudflare (NET)

This streaming service can be a solid investment option because it is not an NFT company per se. Rather, it is a web performance and security company and a leader in the $152 billion software-as-a-service industry.

Video creators who store their videos on Cloudflare Stream can create NFTs for their work on a platform like OpenSea, and then link the token IDs and contact addresses to their videos. The company has seen strong growth in large customer acquisitions recently. The company is off to a strong start in 2023, with first-quarter sales and earnings estimates that exceeded analysts’ expectations.

4. McDonald’s (MCD)

McDonald’s isn’t the first company anyone thinks of when they think “NFT stock,” but the fast-food chain already has a foot in the metaverse pending approval of 10 trademark applications it filed in February 2022.

McDonald’s wants to brand a virtual restaurant with virtual and physical products, entertainment services such as online concerts and downloadable multimedia files, video files and NFTs.

Aside from its involvement in NFT and the metaverse in general, McDonald’s is a solid blue-chip stock and Dividend Aristocrat. That makes it a good choice to balance out some of the riskier stocks in this roundup.

5. Mattel Inc. (MAT)

Mattel’s more than 77-year history of producing iconic toys under brands such as Barbie, Hot Wheels and Fisher-Price positioned the company to pivot into NFTs representing those brands. The California toy maker recently launched an NFT marketplace on Mattel Creations, its collectibles and direct-to-consumer platform.

The first offering, released in December 2022, was Series 4 of the Hot Wheels NFT Garage. New collections, including Monster High and Masters of the Universe, dropped during January. And consumers don’t need to be crypto-savvy to participate—no cryptocurrency is required to purchase NFTs on the Mattel Creations Digital Collectibles Marketplace. Sometime this year, collectors will be able to trade their NFTs on Mattel’s peer-to-peer platform.

Mattel stock is a great value right now, with a P/E ratio of 12.38 and a 12-month price target roughly 30% above today’s price of $18.31.

6. Nvidia (NVDA)

Nvidia is widely known for its graphics, computing and networking solutions, and it is also building a reputation in the NFT industry. Nvidia announced at last year’s SIGGRAPH computer graphics conference that it is working on a number of metaverse projects, including neural graphics, a cloud engine for avatars and a new version of its Omniverse platform where developers can create and launch metaverse applications using a framework developed by Pixar Animation Studios.

Other Omniverse components include Nvidia’s PhysX physics simulation technology and the RTX Renderer. There is a free version for individual creators. Nvidia has agreements with several marketplaces where these creators can sell their 3D work, Reuters reported.

7. Funko (FNKO)

The brand is known for its trendy character toys with big heads. Various designs are already in demand and resell for hundreds, if not thousands, of dollars. The company recently introduced Digital Pop NFT art. Packs of art start at $10, and some buyers will also receive a coin for a physical toy with their purchase.

Funko stock fell dramatically after Funko revised its earnings per share guidance downward for the full year, prompting some investment firms to downgrade their recommendations. But analysts who still have faith in the stock consider it undervalued since the decline. If they are right, investors who buy now and hold the stock may be rewarded for their patience. The stock is trading at $10.33 as of February 10, and the stock has a one-year price target of $12.63, according to Yahoo Finance.

8. Shopify (SHOP)

This e-commerce platform puts buying and selling in the hands of the consumer.

Shopify is currently beta testing an NFT program that will allow merchants to sell NFTs from their stores. But whatever the future holds for the NFT market, Shopify seems to have cemented its place as the most popular e-commerce platform. But you have to wait to see significant gains in the share price.

Shopify stock has taken a beating, losing most of its value from November 2021 to September 2022. The company’s problems stem from its mistaken assumption that the pandemic-driven surge in e-commerce revenue meant a permanent jump, CEO Tobi Lutke wrote in a July 2022 blog mail.

Some analysts believe that the changes implemented since then, such as a 10% reduction and the appointment of a new CFO – Jeff Hoffmeister, former head of technology investment banking at Morgan Stanley – could help turn things around in the next couple of years. The stock has risen over 42% since September 2022.

9. Takung Art (TKAT)

Takung Art distinguished itself by selling physical works of art – specifically Asian works of art. It is unique because it allows for shared ownership. This means that several people can own a work of art together, so that more investors can enter the market.

The company launched its own NFT trading platform, NFTOEO, in April 2022. It may take time for NFT marketplaces to come into their own, but once they do, stocks like Takung Art, which are not yet profitable and trade at $1.03 a share as of 10 February, could take off.

10. Jiayin Group (JFIN)

This stock does not make headlines or cause waves in the stock market. The high-tech financial company is based in Shanghai. Right now, Jiayin Group is not working with NFTs – yet. A series of tweets in December 2020 tipped investors that a shift to NFTs may be in the works.

Last year, speculation that the switch would happen soon fueled a brief uptick in the share price, which is currently hovering around $3.22 as of February 10. Although no NFT-specific announcements have been released, Jiayin has been active in digital art and could easily enter NFTs when the time is right. Meanwhile, the company is seeing slow but consistent growth in earnings and profits.

Final Take

With today’s momentum, it’s safe to say that NFTs aren’t going anywhere, and investing in established companies like McDonald’s and eBay is a relatively safe way to gain exposure to them. The more speculative shares, on the other hand, may take off at some point – or turn out to be worthless in the long run.

As with all investments, talk to an investment professional to find out how NFT stocks fit into your portfolio, do your research and never invest money you can’t afford to lose.

Frequently asked questions about NFT shares

Here are the answers to some of the most common questions about NFTs and investing in NFT shares.

• How does an NFT work?

  • NFTs are similar to cryptocurrency in that they offer a way to buy and sell digital assets. An NFT can be almost anything that someone wants to buy or sell, as long as each one is unique.

  • For example, distributing thousands of prints of the same artwork would not qualify as an NFT. Selling a single piece of unique art — digital or physical — qualifies as an NFT.

• Are NFTs cryptocurrency?

  • No. NFTs and cryptocurrency are similar because they use blockchain technology, but they are not the same. NFTs are non-fungible, meaning that each NFT is unique, while cryptocurrency is fungible, meaning that any bitcoin, for example, can be exchanged for another bitcoin with no value lost or gained.

  • Both cryptocurrency and NFTs are relatively new, but as blockchain technology expands, it will be easier for consumers to understand the difference between the two.

• What does non-fungible mean?

  • Non-fungible means that an item is unique and does not have a default value.

  • NFTs are considered non-fungible because there is no default value that applies to all NFTs. The physical money we use in the world economy is fungible, because it has a standard value and even an exchange rate when trading currency against currency.

• What determines an NFT’s value?

  • An NFT’s value is determined solely by the value an individual investor places on it. It is very similar to collectibles. One person may see no value in an old baseball card, while someone else identifies it as highly collectible.

• What is an NFT share?

  • An NFT share is a security that gives you ownership of a small part of a company involved in NFTs. For example, the company may operate an NFT exchange or build the hardware or software creators need to create NFTs.

• What is the best NFT stock?

  • Which NFT stock is best for you depends on your budget, risk tolerance and investment goals.

  • If you just want to try a stock or two of very cheap NFT stocks to satisfy your curiosity, you can choose one like Jiayin Group, which is highly speculative but costs less than $4. Nvidia may be a better choice for a serious investment in a company directly involved in NFTs. And a stock like McDonald’s, which uses the metaverse and NFT more for marketing than as a business model, is probably best if you’re looking for a safer long-term investment.

Daria Uhlig contributed to the reporting for this article.

The data is accurate as of February 11, 2023, and is subject to change.

This article originally appeared on GOBankingRates.com: 10 Best NFT Stocks to Watch Right Now