Novice Investing - Can Civilization Save Take Two?

Date: Monday 01st 2008f December 2008 05:41:45 PM

Can Civilization Save Take Two? - 11/07/2005

By: Novice Investing Staff

Take Two Interactive (TTWO) decided to buy Firaxis Games, the maker of Civilization, in a bid to diversify beyond its Grand Theft Auto franchise. Both companies have collaborated in the past. They released Civilization IV last month.

Take Two has been trying to reduce its dependence on Grand Theft Auto since the gaming commission assign an 'R' rating to the title. Children and teenagers below 21 are not allowed to buy or play video games with an R rating. This is a terrible blow to Take Two since gamers are generally population with age of 21 or less.

To be fair, Take Two has tried to diversify its revenue stream lately by launching 2k games and 2k sports publishing labels. Sales have been less stellar for these titles. Perhaps, civilization will give Take Two different results.

Take Two doesn't look like a company that will go away anytime soon. It has $ 195 Million of positive net cash or $ 2.75 per share. It is expected to post a profit of around $ 0.86 per share for fiscal year ending in October of 2005. Investors should hope that management can find other valuable franchises to turn its fortune around. The journey will not be smooth. It competes with industry behemoth Electronic Arts (ERTS) who has a successful sport franchise.






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Disclaimer: The sole purpose of this article is educational. This article is merely the opinion of the writer and is not in any way a buy/sell recommendation for Take Two Interactive Software Inc. (TTWO) or any other securities.

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