Electronic Gaming & Multimedia · NASDAQ
Current Price
$215.34
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Take-Two Interactive Software, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Take-Two Interactive Software, Inc. develops, publishes, and markets interactive entertainment solutions for consumers worldwide. The company offers its products under the Rockstar Games, 2K, Private Division, and T2 Mobile Games names. It develops and publishes action/adventure products under the Grand Theft Auto, Max Payne, Midnight Club, and Red Dead Redemption names; and offers episodes and content, as well as develops brands in other genres, including the LA Noire, Bully, and Manhunt franchises. The company also publishes various entertainment properties across various platforms and a range of genres, such as shooter, action, role-playing, strategy, sports, and family/casual entertainment under the BioShock, Mafia, Sid Meier's Civilization, XCOM series, and Borderlands. In addition, it publishes sports simulation titles comprising NBA 2K series, a basketball video game; the WWE 2K professional wrestling series; and PGA TOUR 2K. Further, the company offers Kerbal Space Program, OlliOlli World, and The Outer Worlds and Ancestors: the Humankind Odyssey under Private Division; and free-to-play mobile games, such as Dragon City, Monster Legends, Two Dots, and Top Eleven. Its products are designed for console gaming systems, including PlayStation 4 and PlayStation 5; Xbox One; the Nintendo's Switch; personal computers; and mobile comprising smartphones and tablets. The company provides its products through physical retail, digital download, online platforms, and cloud streaming services. Take-Two Interactive Software, Inc. was incorporated in 1993 and is based in New York, New York.
ROIC (TTM)
-4.5%
ROE (TTM)
-126.4%
FCF Yield
1.22%
Based on trailing twelve-month data, TTWO shows a free cash flow per share of N/A and a ROIC of -4.5%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 1.22% are important context metrics when evaluating TTWO's stock valuation relative to peers.
The intrinsic value of TTWO depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether TTWO is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $215.34. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Take-Two Interactive Software, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Electronic Gaming & Multimedia industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting TTWO's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Take-Two Interactive Software, Inc., this means projecting how much free cash flow the Electronic Gaming & Multimedia will produce over the next 5-10 years, then discounting those amounts to today's dollars. TTWO's ROIC of -4.5% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For TTWO, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
