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Take-Two's WWE 2K15 to Feature Sting as a Playable Character

Zacks Equity Research

2K, a division of Take-Two Interactive (TTWO) recently announced the debut of professional wrestler Sting as a playable character in WWE 2K15, the forthcoming release of the WWE video game franchise. It is scheduled to release in North America on Oct 28 and internationally on Oct 31.

In Feb 2013, 2K which happens to be the publishing unit of Take-Two officially took over the WWE video game license from THQ.

WWE 2K15 has been developed jointly by Yukes and Visual Concepts, a 2K studio. Sting is one of the most renowned names in World Championship Wrestling (:WCW) history. He made his debut in 1991 in WCW and since then has won eight WCW titles.

The character will be available only to those who pre-order the game. The game will be available on Microsoft’s (MSFT) Xbox One and Xbox 360 as well as Sony’s PlayStation 3 & 4 computer entertainment systems.

We believe that the addition of Sting as a playable character will attract more users to the game, translating into higher sales and profitability going forward.

We believe that Take-Two’s robust pipeline is the key growth catalyst for fiscal 2015 and beyond. The company will benefit from the launch of NBA 2K15, Evolve, next-gen WWE title, Borderlands: The Pre-Sequel and Civilization: Beyond Earth.

Post the phenomenal success of Grand Theft Auto V (GTA V) in fiscal 2014, the company is expected to benefit from the game’s release on PS4 and Xbox One this fall. The upcoming update to the online version is also expected to bolster Take-Two’s top-line growth in the near term.

Although Take-Two has a healthy product pipeline, we believe that it will be challenging for the upcoming games to repeat the success of GTA V in fiscal 2015. Take-Two is rumored to release the next installment of GTA V in 2017.

Although we believe that GTA has a loyal customer base, a 2017 release will be way too slow to capture market share from the likes of Electronic Arts’ (EA) Battlefield and Activision’s (ATVI) Call of Duty, both enjoying annual iterations that keep the franchises fresh.

Moreover, Take-Two's overdependence on console gaming sales and lack of mobile gaming titles is a major headwind in the long run.

Currently, Take-Two has a Zacks Rank #3 (Hold).

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