Take-Two Interactive (TTWO), the company behind blockbuster video game franchises like ‘Grand Theft Auto’, closed at $153.65 in the latest trading session, marking a modest +0.21% increase from the previous day. However, this gain lagged behind the S&P 500’s impressive 1.7% surge for the day. The Dow Jones Industrial Average also saw a positive day, gaining 1.26%, while the tech-heavy Nasdaq Composite added 2.51%.
Looking at a longer timeframe, shares of Take-Two Interactive experienced a 4.21% decline over the past month. This underperformance is particularly notable considering the Consumer Discretionary sector, where Take-Two Interactive belongs, witnessed a 2.85% gain during the same period. The S&P 500 also outperformed Take-Two during this timeframe, rising by 1.27%.
Analysts and investors alike will be closely watching Take-Two Interactive’s upcoming earnings release. Expectations are for the company to report earnings per share (EPS) of $0.42, representing a significant 65.85% decrease from the same period last year. However, revenue is anticipated to rise 0.34% year-over-year, reaching $1.45 billion. Looking forward, the Zacks Consensus Estimates predict earnings of $2.53 per share and revenue of $5.61 billion for the full fiscal year. These figures represent a modest +0.8% and +5.28% increase, respectively, from the prior year.
Investors should also pay attention to any recent changes in analyst estimates for Take-Two Interactive. These revisions often reflect the latest short-term business trends, which can change frequently. Positive revisions generally indicate analysts’ confidence in the company’s performance and profit potential. Our research has shown a strong correlation between these estimate adjustments and subsequent stock price performance.
To help investors navigate this dynamic landscape, we’ve developed the Zacks Rank, an exclusive model that incorporates these estimate changes and provides an operational rating system. The Zacks Rank ranges from #1 (Strong Buy) to #5 (Strong Sell), with a proven track record of success. Notably, stocks ranked #1 have delivered an average annual return of +25% since 1988. Over the past 30 days, the Zacks Consensus EPS estimate for Take-Two Interactive has moved 6.76% higher. Currently, Take-Two Interactive holds a Zacks Rank of #3 (Hold).
Examining valuation metrics, Take-Two Interactive currently has a Forward P/E ratio of 60.68. This figure stands significantly higher than the industry average Forward P/E of 15.85, indicating that Take-Two Interactive is trading at a premium to its peers. It’s also important to consider the company’s PEG ratio, which stands at 1.87. Similar to the P/E ratio, the PEG ratio accounts for the company’s expected earnings growth rate. As of yesterday’s closing, the Toys – Games – Hobbies industry had an average PEG ratio of 1.27.
The Toys – Games – Hobbies industry, part of the Consumer Discretionary sector, currently holds a Zacks Industry Rank of 209, placing it within the bottom 18% of all 250+ industries. The Zacks Industry Rank is organized from best to worst based on the average Zacks Rank of individual companies within each sector. Our research has shown that the top 50% ranked industries consistently outperform the bottom half by a factor of 2 to 1.
