Video game maker Take-Two Interactive is making a $260 million bet on it newest title, Grand Theft Auto V ("GTA5"). Investors are hoping it will be a joyride of profits but could it end up arresting portfolio returns?
The GTA5 price tag is no joke. In fact, were it a film, GTA5 would be the one of the most expensive ever made, behind such hits as "Avatar" (2009; $460 million) "Priates of the Caribbean: At World's End" (2007; $300 million) and tied with "Tangled" (2010; $260 million). While $115 million was spent on the actual development, the remaining amount is to be spent on marketing.
And, if they're spending blockbuster dollars, Take-Two is expecting blockbuster results. So far, they've gotten it.
In its first day of sales, Grand Theft Auto V has done $800 million in sales, which is about 13 million to 14 million units. By comparison, the film with the biggest opening day ever was "Harry Potter and the Deathly Hallows Part 2" at $91 million but few people paid $60 for that film the way they did for GTA5.
But while people are lining up to buy Grand Theft Auto V, should you be lining up to buy its maker, Take-Two Interactive?
Looking at the fundamentals is CNBC contributor Gina Sanchez, founder of Chantico Global. Taking Take-Two's charts out for a spin is Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson.
Watch the video above to see Sanchez and Ross analyze Take-Two Interactive and what GTA5 will mean for investors.
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