Last Updated: 09 Nov 2024
Executive Summary
Take-Two Interactive Software Inc. (TTWO) is a leading video game holding company with a market capitalization of $31.47 billion. The company's strong portfolio of titles, including "Grand Theft Auto" and "Red Dead Redemption," has driven revenue growth in recent years. However, the company's profitability has been impacted by increased development costs and a challenging macroeconomic environment. Despite these headwinds, analysts remain optimistic about the company's long-term prospects, with a consensus analyst target price of $185.55.
Company Overview
Take-Two Interactive is a global developer, publisher, and marketer of interactive entertainment products for console systems, personal computers, and mobile devices. The company's products are sold in over 100 countries and translated into 20 languages. Take-Two has two major publishing labels, Rockstar Games and 2K, which operate internal game development studios.
Fundamental Analysis
Revenue: Take-Two's revenue has grown steadily in recent years, reaching $5.46 billion in the trailing twelve months (TTM). The company's revenue growth has been driven by strong sales of its flagship titles, as well as the acquisition of new IP.
Profitability: Take-Two's profitability has been impacted by increased development costs and a challenging macroeconomic environment. The company's operating margin TTM is -0.207%, and its profit margin TTM is -0.664%.
Earnings Per Share (EPS): Take-Two's EPS has been volatile in recent years, with the company reporting a loss per share of $21.2 in the TTM period. The company's EPS is expected to recover in the coming years, as the company benefits from the release of new titles and cost-cutting measures.
Valuation: Take-Two is trading at a forward price-to-earnings (PE) ratio of 67.11, which is above the industry average. The company's high valuation is justified by its strong brand recognition, loyal customer base, and pipeline of upcoming titles.
Technical Analysis
Trend: Take-Two's stock price has been trending sideways in recent months, with the stock trading in a range between $175 and $180.
Support and Resistance: The stock price has strong support at $175 and resistance at $180. A break above $180 would be a bullish signal, while a break below $175 would be a bearish signal.
Moving Averages: The stock price is currently trading above its 50-day and 200-day moving averages, which is a bullish signal.
Short Term Outlook
In the short term, Take-Two's stock price is likely to continue to trade sideways, with the stock moving within a range between $175 and $180. The stock price could break out of this range if the company reports strong earnings or announces a new title that excites investors.
Long Term Outlook
In the long term, Take-Two's stock price is expected to continue to rise, as the company benefits from the release of new titles and cost-cutting measures. The company's strong brand recognition, loyal customer base, and pipeline of upcoming titles make it a good investment for long-term investors.
Analyst Recommendations
Analysts are generally bullish on Take-Two Interactive Software Inc. The consensus analyst target price is $185.55, which represents a potential upside of 4.3% from the current stock price of $177.9. Of the 30 analysts covering the stock, 10 have a strong buy rating, 15 have a buy rating, 4 have a hold rating, and 1 has a sell rating.
