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On Friday, JPMorgan analyst Cory Carpenter adjusted the price target for Take-Two Interactive (NASDAQ:TTWO) to $250, marking an increase from the previous target of $225. The firm maintained its Overweight rating on the stock. According to InvestingPro data, Take-Two’s stock is currently trading at $232.34, near its 52-week high of $238, suggesting significant investor confidence in the company’s prospects despite its high valuation multiples. The revision followed Take-Two’s report of robust fourth-quarter fiscal year results, which exceeded expectations due to the strong performance of key titles such as NBA, GTA Online, Red Dead Redemption 2, and mobile games, driving bookings to the higher end of the company’s guidance.
Take-Two’s announcement of the delay of Grand Theft Auto VI (GTA VI) a few weeks prior to the earnings release underscored the importance of other franchises meeting short-term performance goals. According to Carpenter, these franchises delivered strong results this quarter. This performance has contributed to Take-Two’s impressive 59% stock price return over the past year, with particularly strong momentum shown in a 31% gain over the last six months. Management anticipates a 5% increase in bookings for the next year, propelled by the NBA franchise and the upcoming releases of new titles Mafia and Borderlands 4. The analyst highlighted that the anticipation for GTA VI continues to grow, as evidenced by the 475 million views of its second trailer within the first 24 hours, a record for a cross-platform video launch.
Despite the positive performance, Carpenter noted potential concerns, including the underperformance of Civilization 7, some inconsistencies in profit lines, and a forecasted decline in mobile bookings for fiscal year 2026, which he considers conservative. This conservative outlook may have contributed to a modest sell-off of Take-Two shares in after-hours trading, particularly as the shares were nearing all-time highs.
Looking ahead, Carpenter expects the short-term market focus to be on fiscal year 2027 estimates, while the long-term discussion may center around the sustainability of these performance levels in subsequent years. JPMorgan’s confidence in the company’s outlook is reflected in the firm’s projections of $8.75 billion in bookings and adjusted earnings per share (EPS) of $9.00 for fiscal year 2027. With a current market capitalization of $41 billion and analysts predicting profitability this year, InvestingPro subscribers can access 12 additional key insights and a comprehensive Pro Research Report that provides deeper analysis of Take-Two’s valuation and growth prospects. These projections are based on the assumption of 40 million units of GTA VI sold at a base unit price of $80, and an online launch in the first half of the fiscal year. The Overweight rating and designation of Take-Two as a top pick were reiterated by the analyst.
In other recent news, Take-Two Interactive Software (ETR:SOWGn) Inc. reported its fourth-quarter fiscal year 2025 earnings, revealing a revenue of $1.58 billion, surpassing the forecast of $1.55 billion. However, the company’s earnings per share (EPS) of $1.08 fell short of the anticipated $1.12. The strong revenue performance was driven by successful game launches, including NBA 2K25 and WWE 2K25. Analysts noted that Take-Two projects net bookings for fiscal year 2026 to fall between $5.9 billion and $6.0 billion. The company plans to release 13 titles in FY2026, with significant contributions expected from upcoming games like Mafia: The Old Country and Borderlands 4. Additionally, Take-Two’s mobile gaming segment continues to face challenges, though recent titles like Match Factory and Color Block Jam have shown promising results. The company also addressed concerns regarding goodwill impairment, which was a partial impairment of one of its units.
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