In This Article:
Take-Two Interactive (TTWO) stock extends its gains surrounding its new announcement on the long-awaited Grand Theft Auto VI while also reporting fiscal second-quarter earnings.
Michael Pachter, Wedbush Securities Managing Director of Equity Research, explains how the stock continues to react to the slightest detail on the next Grand Theft Auto installment and whether it is all hype or not at the moment.
"The biggest problem investors have with Take-Two is lack of visibility," Pachter tells Yahoo Finance on the developer's history of teasing this title. "The stock is not trading on yesterday's print or the hype around upcoming titles. It's solely up on GTA, it's going to have a trailer early December."
Click here to watch the full interview on the Yahoo Finance YouTube page page or you can watch this full episode of Yahoo Finance Live here.
This post was written by Luke Carberry Mogan.
Video Transcript
BRAD SMITH: Take-Two Interactive shares getting a big boost this morning.
Fiscal second quarter net bookings topping expectations totaling $1.4 billion.
But the big focus is on "Grand Theft Auto VI."
The first trailer of the game set to be released next month.
A long time coming for fans of the lucrative franchise.
For more on this, Michael Pachter, Wedbush Securities Managing Director of Equity Research is here with us.
We're seeing shares up by about 1.5% right now.
So there must have been something that investors liked, Michael.
Tons of GTA IV fans.
MICHAEL PACHTER: Yeah.
That's really all that it was, Brad.
The print was OK in line on revenue.
And they beat on earnings.
But they didn't pass any of it through.
And the guide was actually disappointing.
They guided sequentially down for the December quarter, which is, seasonally, usually their best quarter.
And that implies back up in the March quarter, which is, seasonally, the weakest quarter.
That implies that there's a game coming, not "GTA."
And, of course, they haven't named it yet.
I think the biggest problem investors have with Take-Two is lack of visibility.
We know all the games they're working on.
"GTA" came out in 2013.
So we've known, at least, since 2015 that there is a new one coming.
But here we are 10 years later.
And it still hasn't formally been announced.
So the stock is not trading on yesterday's print or the hype around upcoming titles.
It's solely up on "GTA" is going to have a trailer early December.
They did not announce the name of the game.
They actually said a trailer for the next installment in the "Grand Theft Auto" franchise.
So I'm not sure we're going to get an announcement that day.