How to Profit From the Mobile-Game Craze

NEW YORK (TheStreet) -- The success of Flappy Bird -- a game app that was pulled from mobile phones last week by its developer -- is a sign of the craze for mobile games, a trend investors can try to profit from.

Vietnamese software developer Dong Nguyen, who created mobile game Flappy Bird last May, told Forbes that the game is addictive and has become a problem. Phones that have the game downloaded are being hawked on eBay (EBAY) for up to $5,000.

Several companies are ready to capitalize on the game's removal. One is Mass Threat, a small privately held videogame maker. The company, with help from popular band Fall Out Boy, released Fall Out Bird for Google (GOOG) Android phones on Wednesday. An iOS version for Apple (AAPL) is also in the works. The game plays out similar to Flappy Bird, but features the floating heads of band members rather than a bird.

Flappy Bird may receive interest from larger gaming companies, which could buy the game from Nguyen and re-release it.

Mobile games such as Flappy Bird are free to download. The money is in the advertising. A hit can bring in a lot of dough and boost shares of companies that develop the games.

Zynga (ZNGA) -- the maker of Farmville and Words With Friends -- has seen its shares fall 50% since its IPO in 2011, but could offer upside if it can turn out some new hits.

Shares of Glu Mobile (GLUU) -- another developer -- are up 24% year to date, and with its games such as Deer Hunter creeping up the top downloads list, its stock could see further gains this year.

Also keep an eye on King.com -- the company behind the popular Candy Crush game. The developer may have an IPO. On Google Play, it is has three of the top 25 free games with Candy Crush, Farm Heroes Saga and Pet Rescue Saga

At the time of publication, the author had no position in any of the stocks mentioned.

Chris Katje is a freelance writer who follows the stock market and whose work appears on several well-known Web sites.

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