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Take-Two Interactive (TTWO) Flat As Market Gains: What You Should Know

·3 min read

Take-Two Interactive (TTWO) closed the most recent trading day at $120.58, making no change from the previous trading session. This move lagged the S&P 500's daily gain of 0.66%. At the same time, the Dow added 0.61%, and the tech-heavy Nasdaq lost 0.02%.

Prior to today's trading, shares of the publisher of "Grand Theft Auto" and other video games had lost 2.59% over the past month. This has was narrower than the Consumer Discretionary sector's loss of 4.73% and the S&P 500's loss of 3.79% in that time.

Wall Street will be looking for positivity from Take-Two Interactive as it approaches its next earnings report date. On that day, Take-Two Interactive is projected to report earnings of $1.39 per share, which would represent a year-over-year decline of 12.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.53 billion, up 54.96% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.98 per share and revenue of $5.85 billion, which would represent changes of -5.86% and +71.59%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Take-Two Interactive. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 26.37% lower within the past month. Take-Two Interactive is currently sporting a Zacks Rank of #4 (Sell).

Digging into valuation, Take-Two Interactive currently has a Forward P/E ratio of 24.22. Its industry sports an average Forward P/E of 15.54, so we one might conclude that Take-Two Interactive is trading at a premium comparatively.

It is also worth noting that TTWO currently has a PEG ratio of 1.33. 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. TTWO's industry had an average PEG ratio of 1.88 as of yesterday's close.

The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 92, putting it in the top 37% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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