Video games have come a long way since Pong hit the market years ago, and the evolution continues at a fast pace. With the industry going digital and mobile gaming generating huge revenue, the next big mega-hit is always right around the corner. Cowen analysts focused in on four top stocks to buy now in a new research report.

With digital downloads growing at a furious pace, the face of the industry has changed, and changed fast. Downloadable content made its debut almost alongside the launch of the Xbox 360, and the growth has been staggering ever since. The Cowen team’s four top stocks include two mobile gaming leaders. The four are Activision Blizzard Inc. (NASDAQ: ATVI), Electronic Arts Inc. (NASDAQ: EA), Glu Mobile Inc. (NASDAQ: GLUU) and King Digital Entertainment PLC (NYSE: KING).

Activision Blizzard

Activision Blizzard is a big player with teens, whether it be on gaming consoles or mobile. The company’s “Hearthstone: Heroes of Warcraft” was huge, top 20 mobile (iPhone, iPad, and Google Play) chart winner last year. In addition, top console winners like last summer’s “Call of Duty: Advanced Warfare” was another huge hit in the Call of Duty franchise, which has propelled earnings for the industry powerhouse.

This stock is now the top pick at Cowen, which sees the company in the middle of a very powerful cycle. The analysts see revenue growth returning next year at a solid 8%. The analysts feel the solid product line, which includes Heroes of the Storm, Overwatch, expanding Hearthstone and Destiny digital content offerings and Call of Duty Online being offered in China.

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Investors are paid a 1% dividend. The Cowen price target for the stock is $26. The Thomson/First Call consensus price target is $25.86. Activision Blizzard closed Tuesday at $22.77 a share.

Electronic Arts

This company is another leading game developer that should benefit from not only the continuing rise in new console sales, but the rising trend of mobile gaming. The company produces top-selling games and related content and services under the EA brand in various categories, including action-adventure, role-playing, racing and first-person shooter games.

The company is very well-known for its EA sports games like Madden Football. Electronic Arts has made the move into mobile play by adapting many of the top franchise titles, which have been popular for years, into the mobile arena.

The Cowen price target for the stock is $55, but the consensus target is up at $57.68. The stock closed Tuesday at $57.80, so Cowen may lift the target at some point.

Glu Mobile

Glu Mobile has remained a top mobile gaming stock to buy at Cowen, and it is still one of the firm’s top investment ideas going forward. The company is now reaping the success of the moves that it made in its past product cycles to monetize its games in a better and more efficient manner. Its strategy of focusing on leveraging platform strength and creating long-term gaming franchises has proved profitable.

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With a huge hit last year with social media star Kim Kardashian, the company gained headline attention. A first-quarter earnings blowout on the top and bottom line, and a hike in forward guidance, was just the beginning. The company, after seeing a big drop in interest in the Kim Kardashian game, scored a huge coup by signing a deal with monster pop star and Super Bowl performer Katy Perry. Analyst Doug Cruetz says, “The shorts will be on the wrong side of history.” With over 22.5% of the float short as of March 13, if he is right, the stock could be a home run.

Cowen has a monster $10 price target for this stock. The consensus objective is posted at $6.77. Shares closed trading on Tuesday at $4.97, so a move to the Cowen target would be over a 100% gain.

King Digital

This stock tortured investors with everything from a lousy IPO to a huge special dividend return of capital that crushed the share price. The fact of the matter is, the company’s numbers speak for themselves, despite the fact that social media mavens hate to be solicited to play a game, and the King Digital games are the leaders. The company recently crushed (no pun intended) top and bottom line earnings guidance, and even Cowen’s own higher estimates, with the launch of Candy Crush Soda Saga driving big quarter-over-quarter growth.

With five new titles expected this year, King Digital is not willing to rest on past laurels. The company has a massive 37.6% of the float sold short as of March 13. A short squeeze could skyrocket this stock.

The Cowen price target is a large $27, and the consensus target is $20.97. Shares closed Tuesday at $16.44. Trading to the Cowen target would be a huge 66% gain for shareholders.

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The video gaming industry still has a lot of room to run, especially for the companies with the top titles. Plus, there is a never-ending supply of new young people who come into the age where video games are fun, as well as provide parents with an electronic babysitter.

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