The video game market has had it rough this year, with many major titles delayed until 2023 or possibly beyond. Yet individual firms are faring reasonably well. Take-Two (NASDAQ:TTWO) notched up around 1% in Friday’s trading after Citigroup (NYSE:C) started coverage on the stock.
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Citi, via analyst Jason Bazinet, declared Take-Two a Hold and gave it a price target of $105. That represents upside potential of about 3%, given the company’s current share price. Despite this, Bazinet noted that, overall, the company has a “bright” future. Bazinet pointed to longer-term projections that suggested recovery from potential losses in Fiscal Year 2024.
Short-term projections don’t exactly look good for Take-Two. Revenue projections were revised downward 20 times in the last three months. Worse yet, earnings per share figures have seen 21 downward revisions in that same time span.
One of the biggest issues for Take-Two, Bazinet noted, was its purchase of Zynga. Zynga was a major feature in the mobile gaming sector, and mobile gaming spiked during the pandemic.
Reports noted that time spent on mobile gaming was up 15.9% between 2019 and 2020. Yet those gains slipped significantly as pandemic restrictions lost ground. Mobile gaming fell 9% in the latest period measured.
Despite this, analysts mostly part company with Bazinet’s projections. Take-Two is considered a Strong Buy right now by analyst consensus estimates. Its current average price target of $137.10 implies 34.36% upside potential.
