#TAKE TWO INTERACTIVE GTA 6 SOFTWARE#
Take-Two Software has a loyal fan base closely awaiting the release of series based games such as GTA.
An approximately -30% decline seems considerably overblown for TTWO as even if a slowdown takes place it should not have a dramatic effect on the expanding gaming industry in my opinion. This pull back is for the most part due to the macroeconomic slowdown projected to take place in 2019. Take-Two has pulled back over $30 from their all-time highs just a few months ago.
(Figure 1) Take-Two Interactive Software Returned Nearly 80% In Less Than 2 Years Upon The Delivery Of Grand Theft Auto 4 Mispricing With Grand Theft Auto 6 acting as the company's most prominent catalyst, TTWO could easily see around 82% returns over the next two years or an average of annual return of over 35% factoring in compounding with a downside of around 10% in my opinion. Open world gaming has been particularly outperforming with names such as Fortnite spreading across the nation which is good news for Take-Two, a leader in the open world genre. Due to economic slowdown projected in 2019, the stock has seen a nearly 30% pullback which I believe is a mispricing as gaming will continue to substantially gain in popularity no matter the market conditions. This trend should have no problem continuing as the gaming industry reaches new highs of growth month after month. Historically, from the time a GTA series game is announced and the time it is released Take-Two Interactive's stock has put up on average well over 30% annual gains (Figures 1 & 4), beating out the S&P by well over 3x on average. Going into 2019 the company is rumored to announce a time frame for the release date of what could be their biggest game yet, Grand Theft Auto 6. Not only has TTWO done a fantastic job of keeping up hit games, but they have also introduced new hit series such as Borderlands and Bioshock to continue to build up consistent revenue growth for the foreseeable future. The company recently signed a large deal with the NBA to continue producing the NBA 2K series for years to come by paying players around 15% of the game's revenue. Take-Two Interactive Software ( NASDAQ: TTWO) has delivered the last year when it comes to blockbuster games breaking all kinds of records along the way with hits like Red Dead Redemption 2, Grand Theft Auto 5, and the NBA 2K series all taking off.
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