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Ticker Shock: Take Two Takes a Hit


Wednesday's top stories and stocks with potential to move.

This isn't exactly the way I was hoping September would start out. Of course, I'm not entirely surprised, as I do believe this market is overextended. But that was a real pummeling by any standard. Hopefully today things will be better.

Asian stocks took a hit overnight. The Hang Seng and the Nikkei were off 1.76% and 2.37%, respectively. European stocks were in the red earlier this morning, too. And here in the US, we're currently trading lower.

Here's what I'm focused on this morning:

Take Two Interactive Software (TTWO):
To its credit, the video-game publisher lost "just" $0.66 a share, excluding items, in its third quarter. Analysts had been looking for a $0.68 loss. It appeared to beat on the top line, too.

My thoughts:

1. A $0.66 loss -- that's fantastic (note sarcasm). It may be better than expected, but it's hard to get overly excited about. Same goes for the $0.89 the Street expects the company to lose this year, or for that matter, the $0.70 it's expected to earn next year.

2. Insiders -- how about getting in the game right now at this price (in the open market)?

3. The stock is up a little bit since I last wrote about it in my article Ticker Shock: Four Reasons Not to Take Two, back in May. But I'm glad I took a pass at that point. My feelings still stand.

4. With all that in mind, keep one eye peeled. If it gets down to the single digits, I may change my mind. For more on TTWO's earnings, see Take-Two Entering New Peak Product Cycle.

Las Vegas Sands
As fellow Minyan Justin Sharon points out, Argus bumped up the company from Hold to Buy.

Some quick thoughts:

1. The stock is a fraction higher than when I wrote about it in mid-August.

But I'm okay with the fact that I took a pass. And in spite of the Argus news -- and the chance that could give the shares a goose -- I'm still unwilling to spin this wheel.

Not to sound like a broken record, but paying bills -- not gambling -- is what's on people's minds these days. It's going to take a while for gambling as a pastime to regain the momentum it previously had.

4. My only "bet" is that tax-loss selling season might not bring good tidings for this stock.

5. Terrific earnings expectations for this year, huh?
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No positions in stocks mentioned.

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