2K, a division of
Take-Two Interactive (
, and Gearbox Software recently announced a new franchise
, which is in development. The game is set to be released in Mar
) Xbox one, Sony's PlayStation 4 and Windows-based personal
2K and Gearbox Software are well-known as the developer and
publisher of the
franchise, which to-date has sold more than 9 million units
globally. Much in the lines of
is a first person shooting game, set in distant future of a
make-believe universe. Gamers can play in both competitive as well
as co-operative modes.
The new game will help Take-Two solidify its position in the
first-person shooting game genre, going forward. The attractive
features and interesting storyline of the game will help Take-Two
capture console market share amid significant competition from
Electronic Arts (
Activision Blizzard (
We believe that Take-Two's robust pipeline is the key growth
catalyst for fiscal 2015 and beyond. The company will benefit from
the launch of
, next-gen WWE title,
Borderlands: The Pre-Sequel
Civilization: Beyond Earth
Post the phenomenal success of
Grand Theft Auto V (GTA V)
in fiscal 2014, the company is expected to benefit from the game's
release on PS4 and Xbox One this fall. The upcoming update to the
online version is also expected to boost Take-Two's top-line growth
in the near term.
For fiscal 2015, the company expects non-GAAP net revenue in the
range of $1.35 to $1.45 billion, while earnings are expected in the
range of 80 cents to $1.05 per share. Both revenues and earnings
per share are expected to significantly decrease on a
year-over-year basis, due to modest growth expectations from
in fiscal 2015.
Although Take-Two has a healthy product pipeline, we believe that
it will be challenging for the upcoming games to repeat the success
in fiscal 2015. Take-Two is rumored to release the next installment
Although we believe that GTA has a loyal customer base, a 2017
release will be way too slow to capture market share from the likes
Call of Duty
, both enjoying annual iterations that keep the franchises fresh.
Moreover, Take-Two's overdependence on console gaming sales and
lack of mobile gaming titles is a major headwind in the long run.
Currently, Take-Two has a Zacks Rank #3 (Hold).
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