Abstract:
"Grand Theft Auto 6" will be released in November this year, and its initial sales are widely expected to reach millions of copies and break records. However, on the eve of the launch of the new game, the stock price of publisher Take-Two has fallen by about 15% this year, and the decline in the past year has been roughly the same.
If the observation period is lengthened, Take-Two's stock price has still risen by 39% in the past five years, but the S&P 500 index has risen by 73% during the same period. In 2007, the company's stock price was about $20; when "Grand Theft Auto V" was released in 2013, the stock price was about $18; today it is around $215.
In January this year, after Google announced its Genie technology that can be used to make games, the stock prices of game companies such as Take-Two and Roblox were hit. Take-Two previously reached a 52-week high of $265 and has yet to recover to that level. Alinea Analytics analyst Rhys Elliott believes that the market is more sensitive to news in the gaming industry, and Take-Two's higher price-to-earnings ratio will also amplify short-term fluctuations.
Business expectations surrounding "Grand Theft Auto 6" remain high. According to sources, the pre-order volume of this game has exceeded 5 million copies, and the related revenue has exceeded 500 million US dollars; by the time of the official release, the pre-order volume may reach 25 million copies, and the revenue will reach 2 billion US dollars. However, these expectations have not yet translated into rising momentum for Take-Two's stock price.
Elliott also said that the previous leaks of "Grand Theft Auto 6" may have caused some investors to worry that the company has lost control of important products. Take-Two is looking for the person responsible for the leak, but has not yet identified the person involved. The series also suffered a serious leak in 2022, and Take-Two later found the person responsible.
Many banks maintain buy ratings on Take-Two stock. JPMorgan Chase gave the target price of $310, Bank of America gave it a target price of $368, and Wells Fargo analysts gave a target price of $293. Rockstar and Take-Two have only publicly introduced the single-player mode of "Grand Theft Auto 6" and positioned it as a single-player experience. The corresponding online multiplayer mode has not yet been officially announced.
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