Grand Theft Auto VI will be a “cultural phenomenon” for Take-Two Interactive, this investor says

Significance Capital Management founder and CIO Ryan Isherwood says Take-Two Interactive (Take-Two Interactive Stock Quote, Chart, News, Analysts, Financials NASDAQ:TTWO) is well positioned heading into the launch of Grand Theft Auto VI.

Speaking on BNN Bloomberg’s Market Call on July 28, Isherwood said the game’s expected November release could be the largest video game launch in a decade.

The investor noted the last Grand Theft Auto title was released in 2013, creating significant pent-up demand. Isherwood said recent survey data and presales point to a strong launch.

“We think this is gonna be a cultural phenomenon,” Isherwood said.

He said the stock is likely to trade more on sentiment around the launch than near-term fundamentals. Sell-side models are currently assuming at least 50 million unit sales, but Isherwood said sales could exceed that and skew toward higher-priced premium versions.

The fund manager said Grand Theft Auto also operates as an ecosystem after launch, with recurring revenue opportunities from online play, added content and in-game purchases.

“We think this is a good setup for going into holiday season,” Isherwood said.

Of the analysts covering Take-Two, 32 rate it “Buy,” one rates it “Hold” and none rate it “Sell,” with a consensus target of US$287.66.

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