Video Game Stock Higher Despite GTA Delay

Take-Two Interactive also slashed its 2025 bookings forecast

Take-Two Interactive Software, Inc (NASDAQ:TTWO) stock is up 2.2% to trade at $149.43, reversing premarket losses after the video game company reported a sharper-than-expected loss for the fiscal fourth quarter. More concerning though, Take-Two also slashed its bookings forecast for next year and pushed back its Grand Theft Auto release to the fall of 2025, instead of later this year. 

The stock is shrugging off three price-target cuts in response, the worst coming from BofA Global Research to $160 from $170. UBS, meanwhile, hiked its target to $156 from $151. On the charts, the shares are now testing their 80-day moving average, a trendline that’s acted as overhead pressure since mid-February, with a rally in April losing steam at this trendline. So far in 2024, TTWO is down 9.2%.

It might be time to monitor the short squeeze situation. Short interest dipped 3% in the last reporting period, yet the 8.49 million shares sold short make up 5% of the stock’s available float, or roughly one week’s worth of pent-up buying power, at TTWO’s average pace of trading.

Drilling down to today’s options activity, 5,564 calls and 14,000 puts have already swapped hands, volume that’s 19 times the intraday average amount. The most popular contract is the June 145 put, where sell to open activity is occurring.  A premium-selling strategy could be the move for the video game stock. TTWO sports a Schaeffer’s Volatility Scorecard (SVS) of 7 out of 100. In other words, both equities has consistently realized lower volatility than its options have priced in.

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