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Take-Two Interactive (TTWO) Stock Sinks As Market Gains: Here's Why

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Take-Two Interactive (TTWO - Free Report) closed the latest trading day at $150.70, indicating a -0.03% change from the previous session's end. The stock fell short of the S&P 500, which registered a gain of 0.08% for the day. Elsewhere, the Dow saw a downswing of 0.12%, while the tech-heavy Nasdaq appreciated by 0.07%.

Prior to today's trading, shares of the publisher of "Grand Theft Auto" and other video games had lost 3.05% over the past month. This has lagged the Consumer Discretionary sector's loss of 1.74% and the S&P 500's loss of 0.21% in that time.

The investment community will be paying close attention to the earnings performance of Take-Two Interactive in its upcoming release. The company is slated to reveal its earnings on August 8, 2024. The company's upcoming EPS is projected at $0.01, signifying a 97.22% drop compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $1.24 billion, showing a 2.95% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $2.54 per share and revenue of $5.62 billion, which would represent changes of +1.2% and +5.45%, respectively, from the prior year.

Investors should also pay attention to any latest changes in analyst estimates for Take-Two Interactive. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 24.47% higher. Take-Two Interactive is currently sporting a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, Take-Two Interactive is holding a Forward P/E ratio of 59.24. This represents a premium compared to its industry's average Forward P/E of 15.04.

Also, we should mention that TTWO has a PEG ratio of 1.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Toys - Games - Hobbies stocks are, on average, holding a PEG ratio of 1.26 based on yesterday's closing prices.

The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. Currently, this industry holds a Zacks Industry Rank of 20, positioning it in the top 8% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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