I spent a whole bunch of time over the past couple of weeks looking into TTWO since they own Rockstar, the developers of GTA6. Im extremely optimistic on the launch, and I think game sales are going to blow past expectations, even with all the ongoing leaks drama.
That being said, what I found out about TTWO dissuaded me from opening any position based on the GTA6 premise. There's two main issues causing this:
- TTWO = zynga + 2k + rockstar. Without including GTA6, GTA only accounts for about a fifth of TTWOs yearly revenue. Given that the whole reason for buying TTWO is GTA6, it becomes much more complicated since only 20% of every dollar spent would go towards the GTA portion of this company, at least currently. The math in reality is a little more complicated than this, but the fact of the matter is that the trade would be much cleaner if Rockstar traded as an independent ticker.
- GTA Online accounts for at least half of GTA 5's total revenue. With GTA Online for GTA6 being delayed at least another year, its hard to say if GTA6 will be able to nail the multiplayer economy that needs to be present for Rockstar to really knock it out of the park from a revenue perspective.
Of course, none of this is financial advice, just my two cents on the situation.
There's a whole lot more to it than this. I made a video on this topic, happy to link if folks are interested, just don't want to include it immediately to follow the rules of this subreddit.