Raymond James moved Take-Two Interactive (NASDAQ:TTWO) from Outperform to Strong Buy but retained its $285.00 price target, a level that implies roughly a 39% upside from the displayed share price of $205.03. The upgrade follows a period of share weakness: Take-Two stock has fallen 15% since January 29 and is down nearly 20% year-to-date, according to InvestingPro data, with technicals suggesting the name may be oversold.
The firm described the market reaction as "overdone," pointing to the company’s recent F3Q26 report and underlying business metrics. Raymond James noted Take-Two’s 20.3% revenue growth over the past twelve months as evidence of strong operational momentum.
Raymond James on AI: "world models are complements, not replacements for game engines" and concerns that AI could supplant publishers are "misplaced" given the human elements of game creation.
In its commentary the firm argued that AI world models "cannot supplant game engines in what makes games fun" and likewise "cannot replace engines in what makes games money" through mechanisms such as user acquisition, distribution, and monetization. The note frames the latest market selloff as driven more by concern over emerging AI creation tools than by any deterioration in Take-Two’s business fundamentals.
Take-Two’s third quarter of fiscal 2026 produced net bookings of $1.76 billion, topping consensus estimates of $1.58 billion. Management attributed the quarter’s outperformance to strong contributions from its NBA 2K franchise and mobile titles, alongside unexpectedly robust engagement and revenue from GTA Online. The company also lifted its fiscal 2026 guidance, setting a midpoint for net bookings at $6.7 billion, a figure that exceeds prior market expectations.
Analysts across the street responded positively to Take-Two’s quarter. Benchmark reiterated a Buy rating with a $300.00 price target and pointed to the significance of the forthcoming GTA VI launch. BMO Capital raised its target to $280.00 from $275.00 following results that materially beat expectations. TD Cowen and DA Davidson both kept Buy ratings with price targets of $284.00 and $300.00, respectively, citing strength in the quarterly performance. Oppenheimer maintained an Outperform rating and a $265.00 target, noting the broad-based strength across Take-Two’s franchises.
Further supporting the company’s recent results, Take-Two reported recurrent consumer spending growth of 23% year-over-year, signaling sustained engagement with its live services and in-game monetization. Taken together, the earnings beat, raised guidance, and reaffirmations or upgrades from several brokerages underpin the more constructive analyst stance despite recent share volatility.
While Raymond James framed the stock’s pullback as an overreaction to AI narratives, the firm’s move to Strong Buy highlights a view that current prices do not reflect the company’s reported top-line strength and durable monetization dynamics. Market participants will likely watch upcoming franchise milestones and any incremental commentary on AI-related tooling closely as they reassess valuation and execution risk.