Tag Archives: ttwo

Take-Two’s ‘Grand Theft Auto’ Still Has Gas In The Tank

Video game publisher Take-Two Interactive Software ( TTWO ) posted better-than-expected fiscal-fourth-quarter earnings late Wednesday, as older game titles continued to drive sales. Take-Two earned 46 cents a share excluding items on sales of $377 million in the quarter ended March 31. Analysts polled by Thomson Reuters had expected the New York-based company to earn 26 cents a share on sales of $306 million. On a year-over-year basis, earnings per share fell 6%, and sales fell 12%. The company faced tough comparisons to the year-earlier quarter, when “Evolve” was released. Take-Two’s fiscal Q4 earnings were bolstered by older titles like “Grand Theft Auto 5,” which first launched in September 2013; “NBA 2K16,” released last September; and “WWE 2K16,” released in October. The company’s “Grand Theft Auto Online” service also posted strong results. New game “XCOM 2” contributed to sales as well. Take-Two stock was up 4%, near 37, in midday trading on the stock market today . Its shares hit a record high of 38.52 on April 4. Two other big game publishers also are trading near all-time highs. Activision Blizzard ( ATVI ) was down 1.5% to below 38 midday Wednesday. Activision hit a record high of 39.93 on Dec. 29. And  Electronic Arts ( EA ) was down 1%, near 74, but it scored a record high of 77.15 on Monday. Take-Two’s guidance for the current fiscal year, however, disappointed, as the company will not release an anticipated sequel to its “Red Dead” Western game this year. At the midpoint of its guidance, Take-Two expects to earn $1.13 a share on sales of $1.55 billion in fiscal 2017. Analysts were modeling $1.91 and $1.76 billion, respectively. Take-Two’s game slate includes the release this month of “Battleborn”; “NBA 2K17” in September; and “Mafia 3,” Civilization 6” and “WWE 2K17” in October. Piper Jaffray analyst Michael Olson reiterated his overweight rating on Take-Two stock with a price target of 40. “While fiscal 2017 guidance is below consensus, most investors will likely give Take-Two a pass on the outlook, given it does not include a new version of ‘Red Dead,’ and management is hinting that fiscal 2018 will be a year of strong growth,” Olson said. In a statement, Take-Two CEO Strauss Zelnick said the company’s Rockstar Games studio is “hard at work on some exciting future projects that will be revealed soon.” Rockstar is the studio behind the “Red Dead” and “Grand Theft Auto” franchises. Take-Two noted that “Grand Theft Auto 5” to date has sold 65 million units, up 5 million in the last quarter. Take-Two Lacking Major Game Catalyst Rest Of Year The lack of a Rockstar game this year leaves Take-Two stock without a major catalyst, said Pacific Crest Securities analyst Evan Wilson. Fiscal 2017 will be the second consecutive year without a Rockstar game, he said in a research note. Wilson rates Take-Two stock as sector weight. Baird analyst Colin Sebastian maintained his neutral rating on Take-Two stock but cut his price target to 37 from 38. Wedbush analyst Michael Pachter reiterated his neutral rating on Take-Two but raised his price target to 32 from 30.50. “We continue to be impressed by Take-Two’s ability to consistently deliver upside to both its guidance and consensus expectations,” Pachter said in a report. “Grand Theft Auto 5’s phenomenal catalog sales and the ongoing robust performance of Grand Theft Auto Online position the company to deliver profits for the foreseeable future; however, we remain unwilling to recommend Take-Two shares until we have greater visibility into its long-term release pipeline.” RELATED: EA Scores Positive Reviews From Investor Day; Stock Gets PT Hike Activision Blizzard Ready To Rack Up Points From E-Sports Disney’s Exit From Toys-To-Life Video Games Could Boost Activision .

EA Scores Positive Reviews From Investor Day; Stock Gets PT Hike

Video game publisher Electronic Arts ( EA ) on Tuesday laid out its plan to add $1 billion in incremental revenue within the next three to five years. EA earned mostly positive reviews for its presentation at the company’s investor day event, held at its headquarters in Redwood City, Calif. Oppenheimer analyst Andrew Uerkwitz reiterated his outperform rating on EA stock but raised his price target to 88 from 78. EA stock was down 1%, near 74, in early afternoon trading on the stock market today . Electronic Arts shares hit an all-time high of 77.15 on Monday. “We came away more confident in EA’s growth strategy and ability to engage existing and potential customers with new tools,” Uerkwitz said in a research report Wednesday. “We believe secular tailwinds such as the move to digital and mobile will support multiyear margin expansion and profit growth for the company.” EA sees future sales growth coming from action games, shooter games and international expansion. It projects that digital growth, including sales of full-game downloads and extra content spending, will boost profitability. Another area of growth is e-sports. EA says competitive gaming initiatives will drive game sales, plus deliver advertising and sponsorship revenue. The next potential catalyst for EA is the E3 video game conference in mid-June, Piper Jaffray analyst Michael Olson said in a note Wednesday. He maintained his overweight rating on EA stock with a price target of 87. EA’s game lineup for its current fiscal 2017 is more attractive than last year’s slate, Olson said. Upcoming releases include “Mirror’s Edge Catalyst,” due out June 7, and “Battlefield 1,” due out Oct. 21. Also in the pipeline are “Titanfall 2,” scheduled for fiscal Q3, and “Mass Effect: Andromeda,” set for late Q4. EA’s fiscal 2017 started April 1. EA ended fiscal 2016 with non-GAAP revenue of $4.57 billion, up 6% year over year. Earnings per share minus items rose 25% to $3.14 in the just-closed fiscal year. EA isn’t the only video game stock trading just below its record high. Take-Two Interactive Software ( TTWO ), which reports fiscal Q4 earnings after the market close Wednesday, hit an all-time high of 38.52 on April 4. Activision Blizzard ( ATVI ) notched a record high of 39.93 on Dec. 29. Take-Two stock was down a fraction, below 36, and Activision stock was up 1%, near 38.50, in afternoon trading Wednesday. RELATED: EA Stock Soars Like ‘Star Wars’ Millennium Falcon After Q4 Beat .

EA Stock Soars Like ‘Star Wars’ Millennium Falcon After Q4 Beat

Electronic Arts ( EA ) stock rocketed higher on Wednesday, a day after the video game publisher reported better-than-expected March-quarter earnings, thanks to hot games like “Star Wars Battlefront.” EA stock was up 12%, near 72.50, in afternoon trading on the stock market today . The stock is at its loftiest point since touching an all-time intraday high of 76.92 on Oct. 29. The Redwood City, Calif.-based company said late Tuesday it earned 50 cents a share excluding items on sales of $924 million in its fiscal fourth quarter ended March 31. Analysts polled by Thomson Reuters had expected EA to earn 42 cents a share on sales of $889 million. On a year-over-year basis, adjusted EPS rose 28%, and revenue inched up 3%. “We grew non-GAAP net revenue, profitability and cash flow to record highs,” Chief Financial Officer Blake Jorgensen said in a statement . “Leveraging our great portfolio of brands and live services has enabled us to break records across our key financial metrics. We expect to drive strong revenue, earnings and cash flow growth into the future.” EA credited “Star Wars Battlefront” and sports games, such as “Madden NFL 16″ and “FIFA 16,” for its gains in Q4. For its current fiscal 2017, EA expects to earn $3.50 a share excluding items on sales of $4.9 billion. That compares with fiscal 2016 results of $3.14 EPS on sales of $4.57 billion. EA hopes to continue its strong performance with new games this year, such as “Mirror’s Edge Catalyst,” due out June 7, and “Battlefield 1,” set for release Oct. 21. Also in the pipeline are “Titanfall 2,” scheduled for fiscal Q3, and “Mass Effect: Andromeda,” set for late Q4. New Star Wars Games Coming From EA Jefferies analyst Brian Pitz maintained his buy rating on EA stock but raised his price target to 105 from 95. “We continue to believe EA is poised to benefit from numerous multiyear tailwinds, including fast sales of consoles and ever more direct-to-consumer digital downloads, which drive improved profitability,” Pitz said in a report. Benchmark analyst Mike Hickey also reiterated his buy rating on EA and inched up his price target to 82.64 from 81.48. Key factors driving his enthusiasm for the company include expectations for continued sales and earnings growth, a compelling game slate ahead and growth of digital downloads and services, Hickey said. Wedbush analyst Michael Pachter reiterated his outperform rating on EA and 12-month price target of 86. “The company provided greater visibility into its long-term release schedule, expecting to launch at least one Star Wars title each year over the next three to four years,” he said in a report. “In fiscal 2018, it expects to launch a Star Wars Battlefront sequel. “In fiscal 2019, it expects to launch a Star Wars action game from Motive Studios and Visceral Games. It also expects to launch a Star Wars game from Respawn Entertainment, which we have penciled in for fiscal 2020. In addition to its Star Wars efforts, EA expects to launch a new, unannounced IP (intellectual property) in fiscal 2018.” Last week, Activision Blizzard ( ATVI ) reported better-than-expected first-quarter sales and earnings , thanks to a boost from newly acquired mobile game publisher King Digital Entertainment. A third major video game publisher, Take-Two Interactive Software ( TTWO ), is scheduled to report fiscal-fourth-quarter earnings on May 18.