Buffett Brain · Research note
Score updated 30 Oct 2026 · analysis from 9 Aug 2026
TTWO· Communication Services
Take-Two Interactive Software
Take-Two Interactive's negative margins and poor returns on capital signal significant challenges that undermine its investment appeal.
Buffett fit
Weak fit
Owner
26
Durability
27
Management
12
Price
55
Score updated 30 Oct 2026 · analysis from 9 Aug 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Communication Services stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned Take-Two outright, I would be concerned about the negative of -1.28% and the of -1.24%.
The full reasoning comes with a free account.
Looking over the next ten years, the main risk to Take-Two's business is the increasing competition in the gaming sector and the potential for franchise fatigue.
The full reasoning comes with a free account.
Take-Two's management has not demonstrated effective , with a share count CAGR of 12.55% and a yield of only 0.1%.
The full reasoning comes with a free account.
With an yield of just 1.14%, which is well below the 8-10% target, the current price of $246.50 does not offer a .
The full reasoning comes with a free account.
Free account
Read the full Take-Two Interactive Software analysis free
- The full reasoning behind all four pillars
- The 5-year price target and the return it implies
- What would change the call
- Graham, Lynch and Greenblatt on the same stock
3 full analyses a week · no card needed
For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1Revenue of $6.66 billion indicates a sizable presence in the gaming industry.
- 2 of 57.23% shows potential for high profitability if costs are managed.
- 3Strong franchises like Grand Theft Auto and NBA 2K have historical success.
- 4 of $461.5 million suggests some operational cash generation.
Concerns
5- 1 of -1.28% and net margin of -4.48% signal ongoing profitability issues.
- 2 of -1.24% and a 5-year average ROIC of -23.14% are well below acceptable thresholds.
- 3Share count has grown at 12.55% annually, indicating dilution of existing shareholders.
- 4Interest coverage ratio of -1.1 suggests challenges in meeting debt obligations.
Price history
$190+1.6%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Take-Two generates revenue through the development and publishing of interactive entertainment, with a TTM revenue of $6.66 billion. However, it has not been profitable, with a net income of -$300 million. The business relies heavily on popular game franchises, which can lead to volatility in earnings. Unit economics are concerning given the lack of profitability.
How this analysis has moved
The call has held across 6 reviews.
Sep 27, 2026 → Oct 30, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Communication Services
Free weekly email
Liked the read on TTWO? Get the next ones on Monday.
Every Monday: the stocks most of the seven investors newly agree on. One email, unsubscribe any time.
Research, not investment advice.
See the Buffett analysis of Take-Two Interactive Software
The score, the checklist and the full reasoning open with a free account. You get 3 full analyses a week, and this stock is the first one. No card needed.
Create a free account3 full analyses a week · no card needed
Already have an account? Sign in