Take-Two Interactive Software TTWO was gaining yardage Tuesday after news it has a new deal with the National Football League to create "non-simulation" football video games.
With a partnership for "non-simulation" games, the league is able to avoid Take-Two creating games that could be seen as directly competing with the popular "Madden" NFL games from Electronic Arts Inc. EA, which remains the exclusive publisher of NFL "simulation games.
"The non-simulation description means that it is likely to be an arcadelike game (think NFL Blitz) vs EA's more realistic game, Madden," Stephens analyst Jeff Cohen said in a note.
Little Impact Expected
Cohen said Take-Two investors will be pleased at the announcement of a new game, but that the impact from the title will likely be small, in the range of 2 million to 3 million units. Cohen has an Equal-Weight rating and $110 target price on Take-Two.
Cohen said EA investors should pay attention, however, noting that anything close to football could be "encroaching further onto EA's sports golden goose," though he noted Take-Two's effort likely won't be competitive with Madden.
Cohen has a Buy rating and $120 price target on EA.
Price Action
Take-Two shares were gaining on the news Tuesday, up more than 2% at publication time to $116.32. EA shares were also up slightly, trading at $101.18.
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