Take-Two Interactive (TTWO): Assessing Valuation After Strong 57% One-Year Return

Take-Two Interactive Software (TTWO) shares have edged higher recently, supported by steady gaming industry demand and moderate financial gains. Some investors are eyeing its one-year return of 57% and considering whether current trends could continue.

See our latest analysis for Take-Two Interactive Software.

Over the past year, Take-Two’s total shareholder return of nearly 57% has certainly turned heads. The most recent 90-day share price return of 16% also hints that momentum remains firmly on the company’s side. This blend of steady industry tailwinds and upbeat investor sentiment suggests confidence in both near-term execution and long-term growth potential.

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With shares just shy of analyst targets and impressive recent gains, investors must ask if Take-Two still has more room to run or if the market has already factored in the company’s potential upside.

Most Popular Narrative: 5% Undervalued

The most widely followed narrative puts Take-Two Interactive Software’s fair value estimate at $270 per share, a modest premium versus the last close at $256.37. With expectations set by upcoming franchise launches and steady momentum, the scene is set for bold valuation drivers.

Strategic investments in technology, AI, and content pipeline efficiency, alongside a strong release slate with multiple high-profile launches (including Borderlands 4, NBA 2K26, and Mafia: The Old Country), undergird management's outlook for record net bookings and enhanced profitability in the coming years.

Read the complete narrative.

Curious what powers this valuation? The narrative’s case hinges on aggressive profit turnaround, ambitious margin expansion, and a future valuation multiple rarely seen outside market darlings. Want to know what bold financial figures mark the path to that target? Uncover the numbers and debates behind the story by tapping into the full narrative now.

Result: Fair Value of $270 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, rising development costs and a heavy reliance on blockbuster releases still threaten Take-Two’s margin growth and revenue stability if expectations are not met.

Find out about the key risks to this Take-Two Interactive Software narrative.

Another View: Multiples Tell a Cautionary Story

Looking through the lens of its price-to-sales ratio, Take-Two trades at 8.2 times sales, well above both industry peers at 6.7x and the broader US Entertainment industry at just 1.6x. The fair ratio, based on sector trends, is estimated at 5x. This premium may signal optimism, but it raises the bar for future growth. Will investors continue to pay up if growth wobbles?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Take-Two Interactive Software Narrative

If you’d rather form your own perspective or want to dive deeper into the data yourself, you can shape an independent view in just a few minutes with Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Take-Two Interactive Software.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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