(FORTUNE Magazine) – I'VE BEEN KEEPING MY EYE ON Electronic Arts for quite a few years now, and I never cease to be amazed at how this company keeps on growing. Tech bubble? What tech bubble? For Electronic Arts, it simply never happened. The stock has tripled over the past five years, long ago passing its 1999--2000 high. Today, EA (as the company is known) has a $20 billion market cap. Hardly small potatoes. Still, I don't think EA quite gets its due.

Unless you've been drinking bloody marys at the Harvard Club for the past decade (and I know some people who have), you're probably aware that Electronic Arts is the world's biggest videogame publisher, with hallmarks like Madden football, The Sims, and Need for Speed. EA makes games for PCs and handheld devices. But the company really made its mark creating titles for the Sony PlayStation, which is the juggernaut of the game-console biz. Sony has sold more than 100 million PlayStations and PlayStation 2s. And PS2 holds a big lead in sales of second-generation game systems, with a market share of 57.5% in North America, compared with 24% for Microsoft's Xbox and 18.5% for Nintendo's Gamecube.

On the other hand, these might not seem like the best of times for EA. Just the other day the company announced that its third-quarter revenues and earnings had declined and gave a relatively drab forecast. Meanwhile, the company has more competition than ever in its signature sports-game sector. And most significant, the entire industry is holding its breath waiting for the next generation of game consoles from Nintendo, Microsoft, and Sony.

So with all that bad news and angst, why has ERTS rallied in the wake of that earnings report to brush up against an all-time high? I think investors realize EA management simply understands the environment better than its rivals. CEO Larry Probst has been at the company for 20 years now and has a strategy built for the long run. (You may have seen that EA recently announced two blockbuster licensing deals: a five-year exclusive with the NFL and a 15-year agreement with ESPN.)

More than that, though, is the fact that EA is the biggest, best-run pure-play proxy for the entire videogame industry, the fastest-growing business in media, and one that is still very much underappreciated on Wall Street. Sure, your average senior institutional investor has probably heard that the videogame business and the movie business both do about $10 billion in annual sales in North America. But I would bet you this hypothetical investor knows way more about Disney or Time Warner than about Electronic Arts. Why? Because he's fiftysomething and doesn't play videogames. Quick: Did you know that EA published The Sims (before I told you in the second paragraph)? FYI, Sims did 16 million units last year for EA. Says one EA exec: "We're kind of like the USC of the tech-entertainment business. All the writers are on the East Coast. They haven't seen us play." Of course, USC's been doing okay recently too.

With a P/E in the mid-30s, ERTS is an expensive stock and ergo hardly undiscovered. Still, EA is simply not covered, understood, or acknowledged by Wall Street with the same passion that is devoted to the traditional media giants. That will change. "The big media companies have been doing this for many decades," says EA's CFO Warren Jenson. "We're just getting started. We still have to earn our spot." Someday, when that 50-year-old money manager is replaced by a 30-year-old with gaming experience, ERTS will assume its rightful place--as a company with a spot right alongside the big boys. ■