Citadel Advisors LLC, the investment management firm established and managed by Kenneth Griffin, purchased 4,820,861 shares or a 5% stake in Take-Two Interactive Software, Inc. (NASDAQ:TTWO) based on its latest 13G filing with the Securities and Exchange Commission (SEC).
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) develops, markets, and publishes interactive entertainment for consumers worldwide under its wholly-owned labels Rockstar Games and 2K.
Take-Two quarterly results
The company recently posted strong financial results for its fiscal third quarter that beat the consensus estimate of Wall Street analysts.
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) delivered $578.4 million profit or $4.69 earnings per share, up from $70.9 million or $0.66 earnings per share in the same period a year ago. The company’s revenue for the quarter to $1.86 billion from $415.8 million revenue recorded last year.
Analysts estimated that the company will generate $1.40 earnings per share and $707.4 million revenue for the quarter.
Strauss Zelnick, chairman and CEO of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) said the company” continued to outperform expectations significantly.” According to him, the strong sales for its game franchises Grand Theft Auto and NBA 2K14, and the successful release of WWE 2K14 contributed to its outstanding financial performance for the quarter.
“As a result of our third quarter performance, we have once again raised our revenue and earnings outlook for fiscal 2014, which is poised to be a record year for Take-Two,” said Zelnick.
Financial outlook
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) projected that it would be able to generate $170 to $200 million revenue for the fourth quarter and around $2.35 billion to $2.38 billion revenue for the full year 2014. The company estimated that its non-GAAP diluted earnings per share for the quarter will be in the range of $0.00 to $0.10 and for the full year in the range of $4.15 to $4.25.
Based on the outlook provided by the company, its earnings and revenue guidance are lower than its results for the third quarter.
Analysts’ reactions
Several analysts issued cautious comments in connection with the financial results of Take-Two Interactive Software, Inc. (NASDAQ:TTWO). Evan Wilson, analyst at Pacific Crest suggested that the company may not have major games under development and recommended a Sell rating for the stock. According to him, he does not expect that company’s profitability to hit record level for some time.
On the other hand, Todd Mitchell, analyst at Brean Capital commented that the company did not provide details regarding plans to increase its digital revenue from its GTA online game, thus giving no assurance to investors that its cash flow will remain stable. He maintained his Hold rating for the stock.
Wedbush downgraded its rating for the stock to Neutral while Benchmark Co also lowered its rating for the shares of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) to Hold.
The stock price of the company dropped more than 9% to $17.20 on Tuesday.
