Exciting new games coming...go to www.thq.com and
Why would all of the analysts
covering THQI reiterate a strong
buy rating if revenue
was going to crash?
Brian F said 20% topline
growth is reasonable expectation.
All of this
fear=opportunity to pick THQI up at ridiculous levels.
> Strategic Goals for 1999
addition to growing its top and bottom lines at a minimum
of 20% for the
> year, mgmt expressed their
strategic goals as: adding 1 or 2 long-term brands
to THQ's current wrestling, bowling, BASS fishing,
role-playing and Rugrats
> franchises; expanding direct
international distribution capability by adding
organizations in 1 or 2 more territories (of which France,
> and Australia are the priority
markets), expanding its PC sales (including
> end, mass market and OEM opportunities),
positioning the company for the
> upcoming new hardware
(Sega's new machine to debut in the U.S. in fall
> Sony's PSX2 expected fall '00, Nintendo's new
machine expected fall '01) and
continue to maintain strict management controls.
> We Emphatically Reiterate Our Strong Buy
> 12-Month Price Target of $45
> We continue to view THQI shares as an outstanding
investment opportunity in
> our universe. We believe
the company's strong prospects combined with
> share price weakness create the most compelling
opportunity for buying this
> stock in the 2- 1/2 years
we have been following the company.
With a foundation of the industry's overall strong
> leading financial
and operating performance give us confidence that our
> $2.28 EPS estimate for 1999 is conservative and
that this stock will
reflect more fully the company's outstanding performance
> * We vociferously reiterate our Strong Buy
recommendation: we believe our
> 1999 EPS
estimate of $2.28 will prove to be conservative,
> in prospects for a $45+ price
for THQI shares over the next 12 months
> December Quarter: Another Out-performance by THQ
and Their 16th Consecutive
> Positive Earnings
> Yesterday THQ announced its December quarter
results, which showed better-
expected performance on both the top- and bottom-lines. On
> apples" basis, adjusting for
a lower-than-anticipated tax rate in Q4
> specific application of THQ's long-term NOL is
visible only with knowledge of
> the company's
full-year results) as well as a share count modestly
> we expected, the company posted
$0.82 in Q4 versus our expected $0.72, and
$1.85 for 1998 versus our expected $1.75.
> THQ showed strong margin improvement
over 1998 both for Q4 and the full year.
margins were a bit lower than our model anticipated due
> expected sales of
lower margin Game Boy and Nintendo 64 games.
The company's operating margins were the highest in
the industry, although
> lower than we
estimated due to the sales mix, but more so due to $2.5mm
> project abandonment costs taken during 4Q98,
versus an historic level of
> approx. $600,000.
Had THQ taken its more normal level of project
> costs, operating margins would have been
consistent with our expectations,
> adjusting for the
> Growth Drivers for
> For the upcoming year we see a number of visible
growth drivers for THQ.
> First, the company
appears to be having an outstanding 1Q: THQ's new
PlayStation WCW game was for the month of January the #1
selling console game
> in the US and the #3 game in
Europe; mgmt said on the conference call that
carry-over sales from 4Q98 of their Rugrats game are much
stronger than they
> expected. We note that THQ will
be selling 4 Rugrats products in 1999. Mgmt
also confirmed that they plan to ship 2 WWF wrestling
products (one each for
> Nintendo 64 and Game Boy
Color) for Holiday '99, the promotion of which
> begin with the E3 industry tradeshow in May, as
well as 2 Pentium III-capable
> OEM PC products,
the first 2 products from their GameFx studio
> 1998. Much of the revenue
from the new Lucas Arts Star Wars games - for
> THQ has exclusive distribution rights in
German-speaking Europe - is expected
> in Q3, the only
quarter in 1999 in which the company will not be
> wrestling product.
I have fine-tooth combed the numbers and can
honestly tell you
that it is the most undervalued stock
in terms of earnings growth
could have easily have shown $1.00+ in earnings if they
weren't so conservative with reserves...
use market looniness to pick some up in the low
Blow away all analyst estimates....My pyschic
$2.75 per share in earnings times a 20 PE
you to $55 or times a 30 PE gets you to
January should be strong as new insitutional money comes
Has anyone noticed that during this stall in the
the blocks have been buys...hence the A
rating in IBD for
HAPPY NEW YEAR!
From a technical standpoint....
market is worried about a dividend cut which is
but I still believe dividend will be in the $1.50
area per year
with increases going
I think buying at $17 3/4 or so is a bargain and
believe a re-test of that area is likely.
At local Toys R Us....
Earnings are going to blow away estimates...I'll keep my
conservative $1 for the 4th qtr......
Should be over soon....probably with 25-27 as
will be off to the races...Early Jan should
be a strong period
as new money flows into
THQI......Looking for $40 by Jan 31
and $45 by earnings in late
Nothing negative here at all...all products selling very
and company is aligning itself with big names to
games in the future........
Yeah right! You shorted at the top....give me a
anyway, you will get squeezed soon and will drop off this
like so many others....THQI should rally to $40-45 by
Earnings are looking like $1-1.10 at moment...depending on
much they hold back for reserves...
Also, a stock
split with earnings would be nice....
Being an Avid bowler, I receive alot of entry
forms in the mail
from various bowling tournaments.
The largest ones are the
High Roller in Vegas and
the Hoinke in Cincy. With both of these
forms, there was a huge advertising flyer for THQI's
bowling game. What a great way to advertise! You get
the target market. Whether this has
translated into sales, I am
not sure....but I liked the
It will all boil down to earnings...if THQI posts
some spectacular earnings, the stock could soar to $45
or so by March.
Take the typical Summer slump and
THQI may then pull back to the
$35-40 area before
running $60. Anyways, I think now is the best
you will have to buy THQI going forward!
THAT is why you buy now!
Earnings should be more than analysts expect. Also, there is a
good possibility that THQI could be bought out.
$60 is possible by XMAS 99!
I think that trying to apply technicals to THQI
will drive you nuts...It is a very thinly traded stock
and therefore, abberations will occur
frequently...the best way to own THQI is
long-term until the