In the latest trading session, Take-Two Interactive (TTWO) closed at $249.98, marking a +1.15% move from the previous day. This move outpaced the S&P 500’s daily gain of 0.79%. Elsewhere, the Dow gained 0.26%, while the tech-heavy Nasdaq added 1.52%.
The stock of publisher of “Grand Theft Auto” and other video games has risen by 8.89% in the past month, leading the Consumer Discretionary sector’s loss of 0.73% and the S&P 500’s loss of 1.82%.
The upcoming earnings release of Take-Two Interactive will be of great interest to investors. In that report, analysts expect Take-Two Interactive to post earnings of $0.31 per share. This would mark a year-over-year decline of 49.18%. In the meantime, our current consensus estimate forecasts the revenue to be $1.35 billion, indicating a 4.85% decline compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $6.7 per share and a revenue of $8.49 billion, indicating changes of +63.41% and +26.3%, respectively, from the former year.
Investors might also notice recent changes to analyst estimates for Take-Two Interactive. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we’ve established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 2.23% lower. Take-Two Interactive currently has a Zacks Rank of #4 (Sell).
Valuation is also important, so investors should note that Take-Two Interactive has a Forward P/E ratio of 36.88 right now. This expresses a premium compared to the average Forward P/E of 18.11 of its industry.
Meanwhile, TTWO’s PEG ratio is currently 3.69. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Gaming industry currently had an average PEG ratio of 1.46 as of yesterday’s close.
The Gaming industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 187, putting it in the bottom 24% of all 250+ industries.
