Video-Game Publishers See Another Blockbuster Year
Grand Theft Auto IV: Video-games publisher Take-Two has had a rough year with a change in management and a run-in with games-certification authorities over what was deemed excessive violence in one of its titles, Manhunt 2.
The release of Grand Theft Auto IV, which was moved from October this year to early 2008, could change the company's fortunes.
However, the market may have already priced the success of the game into the stock. "Everyone knows about it and anticipates it will be a huge hit so the recent strength in Take-Two stock could reflect that," says Ahrens. Take-Two shares were off 7 cents, or 0.3%, to $18.59 on Friday. The stock gained 5.4% this year.
Strong initial sales of Grand Theft Auto IV, which will be available for Sony's (SNE) PlayStation 3 and Microsoft's (MSFT) Xbox 360 console, could bring back the feel-good factor around Take-Two and offer the stock a short-term pop.Take-Two could sell 7.5 million to 8.5 million copies of the game in its fiscal 2008, which ends Oct. 31, and 10.5 million to 11.5 million in the first full year, estimates Michael Pachter, an analyst with Wedbush Morgan. Wedbush Morgan does not own shares of the company or have an investment banking relationship with it. The game could sell 17 million copies over its lifetime, predicts online fantasy video-games stock exchange, The simExchange.
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