TTWO

[Shoe]

I am not ready to issue a buy on this stock, but I think it will be a buy in the near future, here is why.

TTWO has tanked approximately 18% in after-hours trading to ~13.75/share on news that GTA4 has been delayed. I expect it to continue to drop over the next few days. After that, I think it will be a great value buy.

Why?

1. Civ IV is still selling good, and the latest expansion, Beyond the Sword, has been selling like hotcakes, and has been amongst the top amazon video game top sellers list since release.

2. GTA4 is going to be a huge hit when it comes out. GTA4 was priced into their stock, and I imagine that their stock will rebound completely by the time the game is released, or soon after. Unfortunately, that is all the analysis I have at this time, you have more to add or agree/disagree, I would love to hear it.

3. Their sports games, while not quite as good as EA (in public opinion) have been gaining ground. They recently released a football game with a player resembling Vick (customized in appearance, with the #7 and Vick written on the back of the jersery). If they could come out with a football game that did not violoate the NFL license agreement, but at the same time, had an easily downloadable mod, with all the current rosters/players/stats of the NFL that players could use to convert the release version to actual NFL players, I think their NFL game would take off. I don't know if they are actually planning this or not, but it would be huge if they pulled it off. I am not pricing this possiblity into their future stock price as I consider it unlikely. This company has always been a one-hit wonder (GTA) but now they are a 2-hit wonder with the acquisition of the Civilization series. With great success of Beyond the Swords, and the future success of GTA4 that was just discounted from this stock, I think it will be a buy after it bottoms out in the next week or so.

Some people might call me insane, but if you buy while others run away screaming, you often are getting a good deal.