Comparing Glu Mobile (GLUU) and Take-Two Interactive Software (TTWO)

Glu Mobile (NASDAQ: GLUU) and Take-Two Interactive Software (NASDAQ:TTWO) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, earnings, profitabiliy, valuation, analyst recommendations and institutional ownership.

Insider and Institutional Ownership

30.0% of Glu Mobile shares are owned by institutional investors. 5.6% of Glu Mobile shares are owned by insiders. Comparatively, 2.5% of Take-Two Interactive Software shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Glu Mobile and Take-Two Interactive Software’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Glu Mobile $202.84 million 1.70 -$70.23 million N/A N/A
Take-Two Interactive Software $1.78 billion 4.16 $147.17 million $0.49 153.68

Take-Two Interactive Software has higher revenue and earnings than Glu Mobile.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Glu Mobile and Take-Two Interactive Software, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Glu Mobile 0 5 3 0 2.38
Take-Two Interactive Software 1 2 14 0 2.76

Glu Mobile currently has a consensus price target of $2.85, suggesting a potential upside of 11.33%. Take-Two Interactive Software has a consensus price target of $72.00, suggesting a potential downside of 4.38%. Given Glu Mobile’s higher probable upside, equities analysts plainly believe Glu Mobile is more favorable than Take-Two Interactive Software.

Profitability

This table compares Glu Mobile and Take-Two Interactive Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Glu Mobile -50.11% -36.94% -26.41%
Take-Two Interactive Software 3.70% 22.89% 5.73%

Volatility and Risk

Glu Mobile has a beta of 2.06, suggesting that its share price is 106% more volatile than the S&P 500. Comparatively, Take-Two Interactive Software has a beta of 0.66, suggesting that its share price is 34% less volatile than the S&P 500.

Summary

Take-Two Interactive Software beats Glu Mobile on 8 of the 12 factors compared between the two stocks.

About Glu Mobile

Glu Mobile Inc. develops, publishes and markets a portfolio of mobile games. The Company develops and publishes a portfolio of mobile games designed to appeal to a cross section of the users of smartphones and tablet devices. Its portfolio of mobile games is spread across various genres, including Fashion and Celebrity, Food, Sports and Action, Social Networking and Home. Its portfolio of games include Contract Killer, Cooking Dash, Covet Fashion, Deer Hunter, Design Home, QuizUp, Racing Rivals and Tap Sports Baseball, as well as games based on third party licensed brands, including Gordon Ramsay DASH, Kendall & Kylie, and Kim Kardashian: Hollywood. The Company works directly with other application developers to include advertising for their applications in its games, and the developers pay them based on either the number of impressions in its games or the number of users downloading the developer’s application.

About Take-Two Interactive Software

Take-Two Interactive Software, Inc. is a developer, publisher and marketer of entertainment for consumers around the world. The Company develops and publishes products through its labels, Rockstar Games and 2K. It operates through publishing segment. It has a portfolio of software content for the hardware platforms in a range of genres, including action, adventure, family/casual, racing, role-playing, shooter, sports and strategy, which it distributes across the world. The Company’s products are designed for console gaming systems, such as PlayStation 3 and PlayStation 4; Xbox 360 and Xbox One, and personal computers, including smartphones and tablets. Rockstar Games is the developer and publisher of Grand Theft Auto, as well as other franchises, including L.A. Noire, Max Payne, Midnight Club and Red Dead. 2K publishes owned and licensed titles across a range of genres. It has internal development studios in Canada, China, Czech Republic, the United Kingdom and the United States.

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