Take-Two Interactive Software, Inc. (TTWO) Fundamental Analysis: Bull vs. Bear Case

TTWO

Take-Two Interactive Software, Inc.

Fundamental data last updated:May 19, 2026

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company profile

SECTOR

Communication Services

industry

Electronic Gaming & Multimedia

Exchange

NASDAQ

County of HQ

US

Next Earnings Date

05/21/2026

Business Summary

Take-Two Interactive Software, Inc. develops, publishes, and markets interactive entertainment solutions for consumers worldwide. The company offers its products under the Rockstar Games, 2K, Private Division, and T2 Mobile Games names. It develops and publishes action/adventure products under the Grand Theft Auto, Max Payne, Midnight Club, and Red Dead Redemption names; and offers episodes and content, as well as develops brands in other genres, including the LA Noire, Bully, and Manhunt franchises. The company also publishes various entertainment properties across various platforms and a range of genres, such as shooter, action, role-playing, strategy, sports, and family/casual entertainment under the BioShock, Mafia, Sid Meier's Civilization, XCOM series, and Borderlands. In addition, it publishes sports simulation titles comprising NBA 2K series, a basketball video game; the WWE 2K professional wrestling series; and PGA TOUR 2K. Further, the company offers Kerbal Space Program, OlliOlli World, and The Outer Worlds and Ancestors: the Humankind Odyssey under Private Division; and free-to-play mobile games, such as Dragon City, Monster Legends, Two Dots, and Top Eleven. Its products are designed for console gaming systems, including PlayStation 4 and PlayStation 5; Xbox One; the Nintendo's Switch; personal computers; and mobile comprising smartphones and tablets. The company provides its products through physical retail, digital download, online platforms, and cloud streaming services. Take-Two Interactive Software, Inc. was incorporated in 1993 and is based in New York, New York.

VALUATION

P/E

-11.33

Market Cap ($M USD)

$45.37B

Forward P/E

21.03 PEG

0.14 PRICE TO SALES

6.92 PRICE TO BOOK

12.85 EV / EBITDA

-18.83

5-Year Average P/E

Free Cash Flow Yield

1.08%

DCF Value

$-94.39

Graham Number

N/A

Price to FCF

93.01 EV to FCF

96.51 Earnings Yield

-8.82%

FCF Yield

1.08%

DIVIDEND

Yield

0.00%

Annual Payout

$0.00

Payout Ratio

0.00%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

-$21.62

Next Year EPS Growth Estimate

$11.65

Next Year Revenue Growth Estimate

$1.02T

Return on Equity (ROE)

-126.41%

FREE CASH FLOW

Operating Margin

-5.08%

Debt-to-Equity

1.92 Piotroski F-Score

5 Altman Z-Score

2.53 Return on Invested Capital (ROIC)

-4.92%

Current Ratio

1.14 Quick Ratio

1.14 Net Debt to EBITDA

-0.68

Interest Coverage

-5.95

Gross Profit margin

56.02%

FCF PER SHARE

$2.66

REVENUE PER SHARE

$35.76

Gainseekers Quantitative Analysis

Summary

The market’s current valuation of Take-Two Interactive Software, Inc. seems to be a tale of two extremes. Despite a negative DCF value, the stock has traded at a price that suggests optimism, likely driven by its Forward P/E of 18.92, which indicates expectations of future profitability. However, the negative Earnings Yield and a concerning Altman Z-score of 2.16 suggest financial vulnerability. The company’s negative ROIC and operating margin further highlight execution challenges. Overall, the market may be overestimating its growth potential relative to its intrinsic value.

AI Exposure / Tech Reliance

Operating in the Electronic Gaming & Multimedia industry, Take-Two is well-positioned to leverage AI advancements. The gaming sector is inherently tech-driven, and the company's ability to integrate AI could enhance game development and user engagement. This adaptability is crucial for maintaining a competitive edge in a rapidly evolving digital landscape.

The Bull Case

For the discerning GARP investor, Take-Two offers a compelling narrative of potential growth. Despite a negative ROIC, the company boasts a Piotroski F-Score of 5, indicating moderate financial health. Its FCF Yield, though low, suggests some level of cash generation capability. The gross profit margin of 56% underscores strong pricing power, hinting at the company's ability to maintain profitability through strategic cost management and premium product offerings.

The Bear Case

Yet, the stock is not without its pitfalls. The Price/Book ratio of 11.57 and Price/Sales of 6.22 signal a potentially overvalued position, especially given the negative EPS and operating margin. The company is technically extended, trading close to its 52-week high, which could deter risk-averse investors. Additionally, the high Debt/Equity ratio of 1.92 raises red flags about financial leverage and potential liquidity issues.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Buy

Average Analyst Price Target

$290.00

Institutional Ownership %

1-Year Beta

0.97 Insider Buying % (6 Mo)

Distance to 52-Week High

8.08%

Distance to 52-Week Low

23.42%

EARNINGS SURPRISE %

47.66%

50-DAY SMA

$209.42

200-DAY SMA

$231.49

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.