It is very well known that the video game sector is about to get an entire refresh cycle. Sony Corp. (NYSE: SNE) is launching a new PlayStation and Microsoft Corp. (NASDAQ: MSFT) is about to launch the Xbox One, which is really the Xbox 3. What is interesting is that video game sales themselves are still soft, yet the publishers are almost all making serious gains as well. We cannot help but wonder, if you look at the massive share gains, whether investors have simply priced in all the good news.

It is no secret to investors that a new video game console refresh cycle will bring massive boosts to video game spending. After all, it is getting close to a decade since any serious video game console upgrade cycle has been seen from Xbox and PlayStation. We are even seeing that the freemium games that rose to power during and after the recession have become diluted, and there are so many that it is hard to differentiate for buyers.

Sony Corp. (NYSE: SNE) is an ADR and its upgrade cycle win might be more tied to Abenomics and TV hopes as well as other issues. Ditto for Micrososft Corp. (NASDAQ: MSFT). But now take a look at GameStop Corp. (NYSE: GME). Its stock skyrocketed after earnings, as it is not going to be circumvented in a download-only mode for gaming consoles yet. Its stock is now back up above $50, which is more than 150% from its lows seen in the past year, and its stock was dead and buried for years. This is a post-recession high, and we cannot just say that it is a strong stock market.

Activision Blizzard Inc. (NASDAQ: ATVI) is the new king of video games, with WoW and Call of Duty being chased by many other titles in its portfolio. This stock finally broke out of a long-term trading range, and at $16.80, it almost looks like its stock “went on sale” when you consider a 52-week high of $18.43. That being said, its market cap of $18.8 billion stands out to any observer as very high. This king of gamers trades at 13 times expected 2014 earnings.

Electronic Arts Inc. (NASDAQ: EA) is the former king of video games. Suddenly, its stock is back above $27, also up more than 150% from its 52-week low. This is a perpetual turnaround, and now new investors deciding to buy shares are gambling that this chart breakout has legs that could take it back to $40 or even $50. Amazingly, that is where the stock was before the wheels blew out here. EA is worth about $8.5 billion again, and its is valued currently at about 18 times expected 2014 earnings.

Take-Two Interactive Software Inc. (NASDAQ: TTWO) is another breakout chart, hitting a 52-week high of $19.00 on Thursday, also a post-recession high. The hype here is based on the next Grand Theft Auto release for the new gaming consoles. The new GTA should be a top seller, and the best seller ever for its series. The $1.6 billion market cap actually sounds almost cheap by comparison to the rest of the crowd. If you blend the earnings estimates ahead, it trades at close to 11 times forward earnings estimates.

The last of the would-be larger winners from the video game console refresh cycle is Advanced Micro Devices Inc. (NYSE: AMD). Nothing went right for years and years here, yet suddenly AMD finds its processors leading the charge to the point where everyone is overlooking that the PC business stinks for the distant number-two processor company. AMD shares trade just over $4 and have more than doubled off the lows of the past year. Its market cap is not even quite at $3 billion, but 2014 is expected to reverse losses. That being said, AMD trades at about 26 times expected 2014 earnings.

On the death of freemium games, we would call this more of a serious watering down rather than a death. Zynga Inc. (NASDAQ: ZNGA) investors may dispute this, now that the stock is under $3 after having been above $10 after its late-2011 IPO. Nothing has gone right for Zynga, and things are boring enough that investors only now are pointing out that a floor may be in place because of its mountain of cash. The company is just trying to maintain whatever user base it can.

New video game investors have to weigh the runs already seen off the major floors that were put in place. There are many other companies that are in the mix as well.

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