UBS Downgrades THQ On Weak Sales Of New Titles

| About: THQ, Inc. (THQIQ)

UBS software analyst Benjamin Schachter Tuesday cut his rating on video game publisher THQ (THQI) to Neutral from Buy, citing weak sales of several recent titles. He sliced his price target on the stock to $28 from $42. Schachter also cut his earnings estimates for the company: for 2008, he goes to $1.27 from $1.40; for ‘09 he’s now at $1.60, from $1.78.

Schachter says that two key September quarter launches, Juiced 2 and Stuntman, “have been weak at retail.” He says a potential lack of re-orders could impact the holiday quarter. He also says the company does not seem to be benefiting as much as he had hoped from continued strength of Nintentdo’s Wii and DS platforms.

“While there is potential for some ‘09 titles such as UFC, Red Faction 2 and others, we prefer to wait for indication that gamers will find these titles more compelling than the company’s recent releases,” he writes.

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