Wedbush: Take-Two's Quality Focus To Bring Share Price Back Post-Duke Nukem

While Take-Two's stock has suffered of late thanks to the negative reception of Duke Nukem Forever and a handful of game delays over the last several months, Wedbush analysts Michael Pachter, Edward Woo, and Nick McCay say the company is set to recover its share price thanks to its regular lineup of quality games. Wedbush stated in a recent investor note, "Take-Two’s share price has stalled due to numerous game delays and disappointing reviews of Duke Nukem Forever, but we expect Take-Two’s commitment to high quality games to translate into consistent profits and share price appreciation." Despite lowering expectations for Take-Two in the wake of Duke Nukem, Wedbush expressed confidence in the publisher's ability to produce consistent profits. "Of the major publishers, Take-Two has had the fewest 'misses' in terms of game quality over the last two years, and as a result, delivered a profitable FY:11 without a Grand Theft Auto release," the firm said. Wedbush also noted that the recent delay of the Darkness II from Q4 2011 to Q3 2012 will have minimal effect on Take-Two's revenue estimates for the fiscal year, which dropped to $1.6 billion from $1.8 billion. In addition, the firm projected that the company is set to reach a $20 share price within the next 12 months, noting that this estimate "reflects improved profitability and consistent execution" for the publisher. Currently, Take-Two's share price sits at $14.16, though it has dropped as low as $7.98 within the last 52 weeks. Last month, Take-Two CEO Strauss Zelnick said that the company would continue to work with the Duke Nukem IP regardless of critical reception of its latest release, suggesting that the publisher may even take the franchise to realms outside of video games.