Hot Coffee Makes Take-Two A Cheap Buy

Posted by Zonk on Wednesday September 7, 2005 @09:27AM from the own-a-piece-of-a-star dept.

CNN/Money has a look today at the business fallout from the Hot Coffee incident. Though Take-Two's stock has taken a dip as a result of the negative media exposure, analysts say that this is unlikely to affect the company's long-term fiscal health. From the article: "So rather than focus on the problems of the past few months, analysts think investors should look ahead. In its current fiscal year, which ends in October, analysts are predicting a 20 percent increase in earnings and analysts expect profits to jump 31 percent in fiscal 2006. Still, Take-Two's stock trades at just 16 times fiscal 2006 estimates, a steep discount to top rivals Electronic Arts , Activision and THQ."

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reasons for cheap valuation by fool36 · 2005-09-07 10:00 · Score: 2, Informative

There are certainly reasons to discount Take-Two.
So if anything, the sex scene controversy might give future "Grand Theft Auto" titles even more buzz.

...but unfortunately it lead to a loss of $28.8 million dollars this quarter with lowered guidance going forward. IMHO hot-coffee DID reduce revenue and i don't think that calling it 'future buzz' puts it in a better light.