Take-Two Interactive Stock

In January 2022, Take-Two Interactive (NASDAQ: TTWO) announced one of the biggest game industry acquisitions ever with a $12+ billion purchase of mobile game provide Zynga.  That news lasted for a week until it was overshadowed by Microsoft’s planned purchase of Activision Blizzard for $68 billion.

While the Microsoft/ATVI deal is struggling to get approval, the Take-Two/Zynga deal was easily completed in May.  Now Take-Two is struggling with the difficult process of combining two very different entities.

The challenge with Take-Two is expanding beyond Grand Theft Auto.  Investors are awaiting a new GTA.  Any bad news between now and the launch of GTA 6 is likely to see Take-Two stock heavily punished.

Like many investors, DFC is skeptical of Take-Two’s entry into mobile games.  It could prove a major distraction.  Take-Two may be better off focusing on high-end live services through its sports games and core franchises.  The Private Division indie label has also had some nice success with products like Kerbal Space Program.  Kerbal Space Program 2 is scheduled for release next month and it will be an interesting test of Take-Two’s publishing prowess.

Overall analysts are cautiously optimistic about Take-Two Interactive, looking for a 28% stock increase to a price of about $132.  That is still well below the 2022 high of $182.  DFC Intelligence actually expects a rise of closer to 45% with a price of $150.  However, it comes with a big warning.  Take-Two stock price is highly likely to be punished by disappointing results.  Currently, we are not putting Take-Two into the DFC Stock Portfolio.

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