Wednesday, a relative small thing was announced by Take Two Interactive (NASDAQ:TTWO). The company announced it had acquired the rights to make WWE (NYSE:WWE) games from recent bankrupt THQI. While the move won't create a blockbuster, it furthers an impressive 2013 lineup.
The WWE games lineup pairs nicely with Take Two's 2K Games sub-division. 2K Games owns the rights to the NBA 2K franchise and provides a nice sales base for the gaming company every year. This is similar to Electronic Arts and its Madden, FIFA and NHL games, which are put out annually.
Take Two will now be able to release a basketball and wrestling game ever year. Despite declining popularity, the wrestling brand is still a multi-million selling video game franchise. The WWE '13 game sold 0.91 million copies on the XBOX 360 and 0.88 million copies on the PS3.
Adding the WWE game increases a huge blockbuster planned for Take Two in calendar 2013 that includes Grand Theft Auto V and Bioshock Inifinte. Both of these games are among the highest pre-ordered games in the United States. According to VGChartz, here are current pre-orders:
- #1 Bioshock Infinite (XBOX 360): 295,465
- #2 Grand Theft Auto V (XBOX 360): 239, 685
- #5 Grand Theft Auto V (Playstation 3): 206,101
- #6 Bioshock Infinite (Playstation 3): 179,028
I picked Take Two as one of my Top Ten Stock Picks for 2013. The three reasons I gave were the releases of Grand Theft Auto V and Bioshock Infinite, Carl Icahn's investment and the company being an acquisition target. Since the start of 2013, shares are up 35% and continue to set up for an exciting year.
Analysts are projecting Take Two to earn $0.17 in fiscal 2013 from $1.19 billion in revenue. In fiscal 2013, Take Two is expected to earn $2.27 per share. Revenue is expected to increase 49% to $1.78 billion. The new WWE '14 game should add $80 to $100 million in sales and should move well to the bottom line.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.