Take-Two Interactive (TTWO), one of the industry’s largest companies
Strongly believes in the current and future growth possibilities of gaming; and as evidenced by its recent $12.7 billion acquisition of Zynga, and recent public statements, the company could still be on the lookout for additional investment and acquisition deals.
With global consumers having spent roughly $233 billion on video games and related products (with growth to $286 billion by 2025), the company is looking to capitalize not only on traditional and mobile gaming but could also take advantage of metaverse gaming as well.
From 2016 to 2021, TTWO increased its staff headcount by more than double, to 5,046. This has given the company enough bandwidth to develop a massive quantity of games, including potential metaverse titles, at a rather quick rate.
Since its employee ramp up began, TTWO’s sales have grown to $3.4 billion, from $1.4 billion. This represents revenue growth of 2.4X, handsomely outpacing its staff growth.
The company won’t stop there, however.
In 2022, things could get far more interesting after the company’s Zynga acquisition, and further buyouts and investments it may have planned.
This growth-by-acquisition and investment strategy could help TTWO leapfrog some competitors in the space. However, for investors, the best strategy for portfolio growth may lay in buying into companies who are the buyout targets, not the acquirers.
For example, Take-Two paid a whopping 64% premium to acquire Zynga. However, since the January 10th announcement, shares of TTWO have returned about 11%.
The biggest gains in this deal were for those on the receiving end of the buyout, Zynga shareholders.
Read more about the TTWO strategy, HERE
Or discover more potential buyout targets, HERE
Source: https://www.fool.com/investing/2022/03/29/take-two-interactive-poised-for-growth/