Take-Two Interactive
TTWO
$206.16
-0.26%
Take-Two Interactive Software is one of the world's largest video game developers and publishers, operating through flagship labels Rockstar Games, 2K, and mobile subsidiary Zynga, with a portfolio spanning Grand Theft Auto, NBA 2K, Red Dead Redemption, Borderlands, and Civilization. The company is a premium AAA publisher with a platform-like recurring revenue model — roughly three-quarters of sales come from in-game spending, and mobile now represents about half of total revenue following the 2022 Zynga acquisition. The investor narrative is overwhelmingly dominated by the impending launch of Grand Theft Auto VI, whose preorder announcement in June 2026 crushed delay fears and sent shares sharply higher, framing the stock as a binary catalyst play on the largest entertainment launch in industry history. That bullish setup is being actively debated against a backdrop of soft current fundamentals — revenue growth of just 2% year-over-year, persistent GAAP losses, and an AI-driven memory shortage pressuring console economics — leaving investors to weigh near-term earnings weakness against a transformational fiscal 2027 pipeline.…
TTWO
Take-Two Interactive
$206.16
Related headlines
People also watch
Investment Opinion: Should I buy TTWO Today?
Rating: Hold with a speculative Buy bias for risk-tolerant investors. The core thesis is that TTWO offers asymmetric upside if GTA VI launches on time and delivers consensus FY EPS of $9.46, but current fundamentals (2% revenue growth, negative FCF, GAAP losses) and technical weakness (down 20.8% over one year) warrant caution. The analyst consensus of 'strong_buy' with a $286.44 average target implies 39.5% upside, anchoring the bullish view.
Supporting evidence includes: (1) forward PE of 19.94x, which is reasonable if the $9.46 EPS is delivered; (2) gross margin stable at 57.53%, providing a foundation for operating leverage; (3) PEG ratio of 1.30, suggesting the growth-adjusted multiple is not egregious; and (4) the stock's 20.8% one-year decline has de-rated the multiple, with price-to-book compressing from 12.9x to 10.42x. However, PS of 5.50x and EV/Sales of 6.02x remain at a premium to peers, and the negative trailing PE of -121.9x underscores that the market is paying for earnings that do not yet exist.
The biggest risks that could invalidate the thesis are: (1) GTA VI launch slippage, which would expose the stock to the $170 low target; (2) continued margin pressure from the AI-driven memory shortage; and (3) failure to deliver the consensus $9.46 EPS, which would make the 19.94x forward PE look expensive. This Hold would upgrade to Buy if the stock reclaims the $240–$250 shelf that capped the July rally, or if GTA VI preorder data exceeds expectations. It would downgrade to Sell if revenue growth decelerates below 0% or if free cash flow remains negative for another quarter. Valuation verdict: fairly valued relative to its history but at a premium to peers, with the entire thesis resting on flawless GTA VI execution.
Sign up to view all
TTWO 12-Month Price Forecast
The 12-month outlook is balanced with a neutral stance: the GTA VI catalyst is real and preorders confirmed in June 2026, but current fundamentals are weak with 2% revenue growth, negative FCF, and a stock in a technical downtrend. The base case (50% probability) targets $240–$286, aligned with the analyst average of $286.44, assuming on-time launch and consensus EPS delivery. The bull case (30%) reaches $286–$368 if GTA VI exceeds expectations, while the bear case (20%) targets $170–$187 if delays or margin pressure materialize. I would upgrade to bullish if the stock reclaims the $240–$250 resistance shelf or if preorder data significantly exceeds expectations; I would downgrade to bearish if revenue growth turns negative or if FCF remains negative for another quarter.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Take-Two Interactive's 12-month outlook, with a consensus price target around $286.44 and implied upside of +38.9% versus the current price.
Average Target
$286.44
0 analysts
Implied Upside
+38.9%
vs. current price
Analyst Count
—
covering this stock
Price Range
$170 - $368
Analyst target range
Coverage is deep and uniformly constructive: 29 analysts follow Take-Two with a consensus recommendation of "strong_buy" (mean rating 1.21 on a 1–5 scale) and an average target price of $286.44, implying +39.5% upside from the current $205.28. The institutional ratings feed shows a wall of reaffirmations in early August 2026 — Wells Fargo at Overweight, BTIG at Buy, Baird and Oppenheimer and Wedbush at Outperform, DA Davidson and Roth at Buy — with no downgrades in the visible record, indicating the sell-side is holding the line through the drawdown. Consensus FY revenue of $10.12 billion and EPS of $9.46 confirm that the entire Street model is built on the GTA VI inflection.
The target range of $170 to $368 is extraordinarily wide — a 116% spread from low to high — which signals genuine disagreement about the magnitude of the launch rather than about direction. The $368 high target implicitly assumes a record-shattering GTA VI launch with multiple expansion and durable monetization, while the $170 low target prices in launch slippage, margin compression from the memory shortage, and a re-rating toward current cash-flow economics. The fact that the average sits 39.5% above spot while the low sits 17.2% below it means the distribution is skewed bullish but with a real left tail; with the stock already down 20.8% over a year despite "strong buy" consensus, the market is clearly discounting some of the Street's optimism, and the gap between analyst conviction and price action is the single most important tension in the name.
Drowning in data?
Find the real signal!
Bulls vs Bears: TTWO Investment Factors
The bear case currently has stronger near-term evidence: revenue growth of just 2%, persistent GAAP losses, negative free cash flow of -$193.8 million in the latest quarter, and a stock in a sustained downtrend down 20.8% over the past year. However, the bull case rests on a transformational catalyst—GTA VI—with preorders confirmed in June 2026 and analyst consensus of 'strong_buy' with a $286.44 average target implying 39.5% upside. The single most important tension is whether the GTA VI launch lands on time and delivers the consensus $9.46 EPS; if it does, the forward PE of 19.94x is attractive, but any slippage would expose the stock to the $170 low target and further downside toward the 52-week low of $187.63.
Bullish
- GTA VI preorder catalyst confirmed: The June 2026 preorder announcement crushed delay fears and drove a 5% single-day gain, with shares rallying from ~$216 to $258 by early July. This confirms the launch timeline and frames the stock as a binary catalyst play on the largest entertainment launch in industry history.
- Analyst consensus overwhelmingly bullish: 29 analysts rate TTWO a 'strong_buy' with a mean rating of 1.21 and an average target of $286.44, implying +39.5% upside from $205.28. The high target of $368 suggests some analysts expect a record-shattering launch with multiple expansion.
- Forward PE of 19.94x embeds massive earnings step-up: Consensus FY EPS of $9.46 implies roughly a 6x earnings step-up from trailing negative EPS of -$0.008, driven by GTA VI revenue conversion. If delivered, the forward multiple is reasonable for a premium content publisher.
- Gross margin stable at 57.5%: Gross margin has been stable-to-improving across recent quarters (55.88%, 55.65%, 55.28%, 57.53%), consistent with a premium AAA publisher. This provides a solid foundation for operating leverage as GTA VI scales revenue.
Bearish
- Revenue stagnating at 2% YoY: The June 2026 quarter delivered $1.534 billion, up just 2.0% year-over-year, with sequential softening from $1.680 billion in March and $1.699 billion in December. The investment case rests entirely on a step-function GTA VI inflection rather than organic momentum.
- Persistent GAAP losses and negative FCF: The latest quarter posted a net loss of $34.1 million (-$0.18 EPS) and free cash flow turned sharply negative at -$193.8 million, driven by a -$588.4 million working capital swing. ROE of -8.49% confirms capital is being destroyed on a trailing basis.
- Technical downtrend with falling-knife profile: TTWO is down 20.81% over the past year and 18.41% YTD, vastly underperforming the S&P 500's +15.53% and +11.93%. At $205.28, it sits only 9.4% above the 52-week low of $187.63 and has surrendered nearly all mid-year GTA VI gains.
- Memory shortage pressures console economics: An AI-fueled memory shortage is creating a supply crisis that directly hurts gaming console makers' margins. This external headwind could compress profitability even as GTA VI launches, particularly for the console segment that generated $640.5 million last quarter.
TTWO Technical Analysis
Take-Two is in a sustained downtrend, with the stock down 20.81% over the past year and 18.41% year-to-date, a stark underperformance versus the S&P 500's +15.53% and +11.93% over the same periods. At $205.28, the shares sit at roughly 22.5% of the 52-week range of $187.63–$265.94 — deep in the lower quartile and only about 9.4% above the 52-week low, a positioning that reflects persistent distribution rather than momentum leadership. This is a falling-knife profile rather than a value entry: the stock has surrendered nearly all of its mid-year GTA VI preorder gains and is testing the lower boundary of its annual range.
Short-term momentum is negative and decelerating, with the stock down 3.08% over the past month and 13.27% over three months, extending rather than diverging from the longer-term decline. The 1-month relative strength of -4.30 versus SPY confirms the stock is losing ground even as the broader market grinds higher, and the 3-month relative strength of -15.96 shows the underperformance is widening, not stabilizing. The most recent session saw a 1.96% drop on volume of roughly 2.59 million shares, and the stock's max drawdown of -27.68% underscores how violent the mid-year round trip from the July high near $258 has been.
Key technical levels are well defined: support rests at the 52-week low of $187.63, roughly 8.6% below the current price, while resistance sits at the 52-week high of $265.94, about 29.5% above. A breakdown below $187.63 would signal that the market is de-rating the GTA VI catalyst and could open a deeper leg lower, whereas reclaiming the $240–$250 shelf that capped the July rally would be the first evidence of a trend repair. With a beta of 0.974, the stock is roughly market-neutral in volatility terms — notably, it is not a high-beta proxy, meaning the recent weakness is idiosyncratic rather than a broad risk-off move, which matters for position sizing since diversification benefits are limited when the drawdown is company-specific.
Beta
0.97
0.97x market volatility
Max Drawdown
-27.7%
Largest decline past year
52-Week Range
$188-$266
Price range past year
Annual Return
-20.8%
Cumulative gain past year
| Period | TTWO Return | S&P 500 |
|---|---|---|
| 1m | -1.8% | -0.1% |
| 3m | -10.5% | +4.7% |
| 6m | -2.2% | +8.3% |
| 1y | -20.8% | +15.2% |
| ytd | -18.1% | +13.4% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
TTWO Fundamental Analysis
Revenue is essentially stagnating at the top line: the most recent quarter (June 2026) delivered $1.534 billion, up just 2.0% year-over-year from $1.504 billion, and the trailing four-quarter run rate of roughly $6.4 billion shows no meaningful acceleration. The sequential trend is actually softening — revenue fell from $1.680 billion in the March quarter and $1.699 billion in December — and the segment mix shows mobile at $762.3 million and console at $640.5 million, with PC and other at just $131.1 million, meaning the mobile/Zynga book is now the largest single contributor and the console business is carrying the cyclical burden. The investment case therefore rests almost entirely on a step-function revenue inflection from GTA VI rather than organic momentum, which is precisely why the stock trades on headlines rather than quarterly prints.
Profitability remains negative on a GAAP basis, with the latest quarter posting a net loss of $34.1 million (-$0.18 EPS) and a net margin of -2.22%, though this is a marked improvement from the -$59.5 million loss in the prior quarter and the -$133.9 million loss a year earlier. Gross margin is healthy at 57.53% and has been stable-to-improving across recent quarters (55.88%, 55.65%, 55.28%), consistent with a premium content publisher, but operating margin of -1.63% and EBITDA of only $29.3 million (a 1.91% EBITDA margin) show that heavy operating expenses — $918 million in the quarter, including $273.8 million of R&D and $369.7 million of selling and marketing — are consuming nearly all gross profit. The trajectory is toward breakeven rather than away from it, but the company is not yet earning its cost of capital.
Balance sheet and cash flow are the weakest link in the current setup: free cash flow turned sharply negative at -$193.8 million in the June quarter versus +$187.2 million in the March quarter, driven by a -$588.4 million working capital swing and -$168.8 million of operating cash flow, even as TTM free cash flow remains positive at $326.1 million. Debt-to-equity stands at 0.84 with a current ratio of 1.24, and cash of $1.446 billion against total debt implies a leveraged but manageable position; ROE of -8.49% and ROA of -0.62% confirm capital is being destroyed on a trailing basis. The company is funding its content pipeline internally but with thin cushion — the negative FCF quarter and 58.6x price-to-cash-flow multiple mean any GTA VI slippage would force reliance on external financing or further balance sheet strain.
Quarterly Revenue
$1.5B
2026-06
Revenue YoY Growth
+2.0%
YoY Comparison
Gross Margin
57.5%
Latest Quarter
Free Cash Flow
$326100000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is TTWO Overvalued?
Because trailing net income is negative (-$34.1 million in the latest quarter, -$0.008 EPS trailing), the trailing PE of -121.9x is meaningless and I am leading with the price-to-sales ratio of 5.50x and EV/Sales of 6.02x as the primary metrics, supplemented by the forward PE of 19.94x. The enormous gap between the negative trailing PE and the 19.94x forward multiple — built on consensus FY EPS of $9.46 — is the entire valuation story: the market is paying today for earnings that do not yet exist, implying roughly a 6x earnings step-up as GTA VI converts the revenue base. That forward multiple is only cheap if the consensus number is delivered; it embeds near-flawless execution.
Against the sector, the stock screens expensive on sales-based measures: PS of 5.50x and EV/Sales of 6.02x sit at a premium to typical interactive entertainment peers, while EV/EBITDA of 30.6x and price-to-book of 10.42x reflect a business with depressed current profitability rather than a structural margin advantage. The PEG ratio of 1.30 is the most reasonable data point in the set, suggesting the growth-adjusted multiple is not egregious — but that PEG depends on the same forward earnings leap. In short, the premium is a bet on the pipeline, not a reflection of current competitive economics, and it leaves little room for disappointment.
Historically, the stock's PS ratio has ranged from roughly 12.4x in late 2022 to over 30x in mid-2026 on the historical ratios series, and the current 5.50x reading on the live valuation data is at the low end of that band — though the discrepancy between the two datasets (historical PS of 21.8x–30.3x versus the current 5.50x) likely reflects differing share-count or revenue bases and should be treated cautiously. What is unambiguous is that price-to-book has compressed from 12.9x in the June quarter to 10.42x now, and the stock's 20.8% one-year decline has de-rated the multiple even as the GTA VI catalyst approaches. The market is pricing optimistic launch expectations but has already taken substantial valuation risk out of the shares — the setup is asymmetric only if the launch lands on time.
PE
-121.9x
Latest Quarter
vs. Historical
N/A
5-Year PE Range 17x~59x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
30.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are substantial: TTWO generated a net loss of $34.1 million in the June 2026 quarter with a -2.22% net margin, and free cash flow turned sharply negative at -$193.8 million versus +$187.2 million in the prior quarter, driven by a -$588.4 million working capital swing. Debt-to-equity stands at 0.84 with a current ratio of 1.24, and cash of $1.446 billion against total debt implies a leveraged but manageable position. However, the negative FCF quarter and 58.6x price-to-cash-flow multiple mean any GTA VI slippage would force reliance on external financing or further balance sheet strain, while operating expenses of $918 million (including $273.8 million R&D and $369.7 million S&M) consume nearly all gross profit. Revenue concentration is extreme: GTA historically accounts for about 30% of sales, and the entire investment case now hinges on a single title's launch.
Market and competitive risks center on valuation compression and external headwinds. The stock trades at a PS of 5.50x and EV/Sales of 6.02x, a premium to interactive entertainment peers, while EV/EBITDA of 30.6x and price-to-book of 10.42x reflect depressed current profitability rather than structural margin advantages. An AI-fueled memory shortage is creating a supply crisis that directly hurts gaming console makers' margins, and Sony's shift to all-digital gaming by 2028 signals a permanent industry transformation that could disrupt traditional console economics. With a beta of 0.974, the stock is roughly market-neutral, meaning the recent weakness is idiosyncratic rather than a broad risk-off move—diversification benefits are limited when the drawdown is company-specific. The 1-month relative strength of -4.30 versus SPY confirms the stock is losing ground even as the broader market grinds higher.
The worst-case scenario is a GTA VI delay or disappointing launch combined with continued margin pressure from the memory shortage. In this scenario, the stock could retest its 52-week low of $187.63 (8.6% below current) or fall to the analyst low target of $170 (17.2% below current). A breakdown below $187.63 would signal that the market is de-rating the GTA VI catalyst and could open a deeper leg lower, with the max drawdown of -27.68% illustrating how violent the mid-year round trip from the July high near $258 has been. From the current price of $205.28, an investor could lose 8.6% to the 52-week low or 17.2% to the analyst low target in this adverse scenario.
FAQ
The most severe risk is GTA VI launch slippage, which would expose the stock to the $170 analyst low target (17.2% downside) and likely trigger downgrades. Second is financial risk: free cash flow turned negative at -$193.8 million in the June quarter, and debt-to-equity of 0.84 with a 58.6x price-to-cash-flow multiple leaves little cushion. Third is competitive/macro risk: the AI-driven memory shortage is pressuring console margins, and Sony's all-digital shift by 2028 could disrupt traditional console economics. Fourth is company-specific execution risk: revenue growth of just 2% YoY and persistent GAAP losses mean the entire thesis rests on one title. Ranked by severity: launch slippage > financial strain > memory shortage > execution risk.
The 12-month forecast has three scenarios: bull case (30% probability) targets $286–$368 if GTA VI exceeds expectations and drives FY revenue to $11.6 billion; base case (50%) targets $240–$286 assuming on-time launch and consensus EPS of $9.46; bear case (20%) targets $170–$187 if delays or margin pressure materialize. The base case is most likely, anchored by the analyst average target of $286.44 and the forward PE of 19.94x. The key assumption is that GTA VI launches in FY2027 as scheduled and delivers the consensus earnings step-up. A close above $250 would confirm the bull case, while a break below $187.63 would validate the bear case.
TTWO is fairly valued relative to its own history but at a premium to peers. The PS of 5.50x and EV/Sales of 6.02x are above typical interactive entertainment peers, while the negative trailing PE of -121.9x is meaningless due to GAAP losses. The forward PE of 19.94x is the key metric: it implies the market expects a 6x earnings step-up to $9.46 EPS, which is only reasonable if GTA VI delivers. The PEG ratio of 1.30 suggests the growth-adjusted multiple is not egregious, and price-to-book has compressed from 12.9x to 10.42x. The market is paying a premium for the pipeline, not current economics, leaving little room for disappointment.
TTWO is a good buy only for risk-tolerant investors with a 12-18 month horizon who believe GTA VI will launch on time and meet consensus. The risk/reward is asymmetric: analysts see 39.5% upside to the $286.44 average target, but the stock sits just 9.4% above its 52-week low of $187.63 and could fall 17.2% to the $170 low target if the launch disappoints. The forward PE of 19.94x is attractive if the $9.46 EPS is delivered, but current fundamentals—2% revenue growth and negative FCF of -$193.8 million—offer no margin of safety. For conservative investors, the binary catalyst risk and lack of dividend make it unsuitable; for aggressive growth investors, a small position with a stop below $187.63 is reasonable.
TTWO is best suited for a medium-term holding period of 12-18 months, bridging the GTA VI launch and its initial monetization cycle. The stock is not a short-term trading vehicle given its beta of 0.974 and idiosyncratic drawdowns (max drawdown of -27.68%), nor is it a long-term compounder yet given negative ROE of -8.49% and no dividend. The binary catalyst nature means earnings visibility is low until GTA VI launches, making it unsuitable for buy-and-hold investors seeking stable returns. A suggested minimum holding period is 12 months to capture the launch and initial sales data, with a stop-loss below the 52-week low of $187.63 to manage downside.
