Video Game Stock Fighting for Fourth Straight After Raised Guidance

The company also reported a fiscal second-quarter earnings beat

Deputy Editor
Nov 6, 2020 at 9:50 AM
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The shares of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) are up 0.2% at $169.04 at last check, after the video game maker raised its annual sales forecast. The company noted that its largest contributors were NBA 2K20, NBA 2K21, and Grand Theft Auto V. Furthermore, the company reported a fiscal second quarter earnings and revenue beat. Keeping a cap on gains, however, is sector peer Electronic Arts' (EA) sales forecast for the holiday quarter missing estimates, as well as Piper Sandler's price-target cut to $186 from $200. 

Bouncing off the $153 level earlier this week -- which has served as a floor since the stock's early-September drop -- the equity is now on track for its fourth-straight daily win. Year-to-date, TTWO remains up almost 38%. 

The price-target cut today makes more sense considering the brokerage bunch is mostly bullish on Take-Two stock, with 15 of the 18 analysts in coverage at a "buy" or better rating. Meanwhile, the 12-month consensus price target of $189.88, which represents a new record high, is a 12.6% premium to last night's close. 

The options pits are of similar sentiment, per TTWO's 50-day call/put volume ratio of 4.04 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 86% of readings from the past year, revealing a penchant for long calls amongst options traders as of late.

Options traders are getting in on the post-earnings action today, with options volume running at triple the average intraday amount. So far, the weekly 11/6 160-strike put is the most popular, followed closely by the 11/13 167.50-strike call. Selling activity appears to be occurring at both contracts.


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