Will Hello Kitty Lead Majesco Entertainment Shares Higher?

| About: Majesco Entertainment (COOL)

Shares of Majesco Entertainment (NASDAQ:COOL) traded up 5% on Friday. The uptick in share price seemed rather odd on a day when the overall market was getting hammered down. The key positive for Majesco Entertainment this week was a new deal with Sanrio, the owner of the Hello Kitty brand.

The company will be releasing "hello Kitty Picnic with Sanrio Friends" for the Holiday 2012 season. The game will bring the Hello Kitty character to the Nintendo 3DS for the first time. Along with Hello Kitty, Majesco will integrate other Sanrio characters like: Melody, Keroppi, Chococat, Badtz-Maru, and Little Twin Stars. The game features 10 Mini Games including: Hidden Object, Spot the Difference, Picnic Basket, and Checkers. The Hello Kitty brand is everywhere from clothing to school supplies. Over nine million people like the company's Facebook page. The company has not had huge success with video games, but this could be the one to break through.

Majesco shares traded up during the week on the Hello Kitty news. Perhaps investors see the huge potential of this game. The Nintendo 3DS is aimed at children, which is Hello Kitty's key market. Sanrio offers over 100 Hello Kitty boutique stores which will all likely carry the video game. The Japanese company is expanding its store base inside the United States. Japan has also been a great place for video game companies to flourish. The game will not outsell the Zumba Fitness franchise, but is a nice addition to a company in desperate need of diversification.

Majesco is stacking up its 2012 Holiday Season with several video game releases. Along with Hello Kitty, the company has a new NBA game, a fitness game with Harley Pasternak, new Cooking Mama combo packs, and a new Zumba Fitness game.

Majesco Entertainment will be launching "NBA Baller Beats" for the 2012 Holiday Season. I wrote an in depth article about the new game (Article here). The criticism was overwhelming for a video game that will allow users to dribble a basketball indoors to simulate movement on screen. I remain upbeat about the game and think that the positives for the game keep coming in. The company recently signed two deals with Spalding and Panini. Spalding (BRK), the official basketball of the National Basketball League, will have an official NBA ball included with the game. Panini, the official card company of the NBA, is creating cards based on the game and cards with unlockable characters and items to use in the game.

Another game coming to Majesco Entertainment's portfolio is "Harley Pasternak's Hollywood Workout". Harley Pasternak, a famous celebrity trainer, brings his workout program to the Nintendo Wii and XBOX 360. A five factor program centered around 25 minute a day workouts for five days will be available for users to partake in. Pasternak has trained celebrities like Lady Gaga, Jennifer Hudson, Megan Fox, Katy Perry, Kanye West, and Robert Pattinson. Pasternak is also a spokesperson for shoe brand New Balance and soft drink brand Fuze, a Coca-Cola (NYSE:KO) product.

The original "Cooking Mama" game for Nintendo DS sold over 5.3 million copies. Majesco Entertainment will be releasing combo packs of the original game and some of its sequels. The games will retail for $29.99.

· Combo Volume 1 (Nintendo DS) - "Cooking Mama", "Camping Mama: Outdoor Adventures"

· Combo Volume 2 (Nintendo DS) - "Cooking Mama 2: Dinner with Friends", "Crafting Mama"

· Mama's 2 Pack (Nintendo Wii) - "Cooking Mama Cook Off", "Cooking Mama World Kitchen"

Majesco has begun fully maximizing its Zumba Fitness video game brand. The newest game, Zumba Fitness Rush, offered downloadable content for customers to add routines, songs, and outfits for characters. These add-ons have become standard in the video game industry and further the lifespan of a video game's revenue stream. A new Zumba Fitness game will be released for the Holiday Season in 2012.

Analysts on Yahoo Finance see the company earning $0.32 per share in fiscal 2012. The following year, analysts see the company earning $0.38 per share. Shares remain trading at less than ten times this year's earnings. I remain bullish on shares of Majesco Entertainment, a company which I own in real life. I think shares could hit $10 by the end of 2013. The company remains an attractive buyout target as well.

Disclosure: I am long COOL.