Take-Two Interactive Software (NASDAQ:TTWO) vs. Roblox (NYSE:RBLX) Critical Comparison

Take-Two Interactive Software (NASDAQ:TTWO) and Roblox (NYSE:RBLX) are both large-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.

Volatility and Risk

Take-Two Interactive Software has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500. Comparatively, Roblox has a beta of 1.63, suggesting that its stock price is 63% more volatile than the S&P 500.

Earnings and Valuation

This table compares Take-Two Interactive Software and Roblox”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Take-Two Interactive Software	$5.80 billion	8.20	-$4.48 billion	($23.94)	-10.77
Roblox	$3.60 billion	23.89	-$935.38 million	($1.43)	-93.30

Roblox has lower revenue, but higher earnings than Take-Two Interactive Software. Roblox is trading at a lower price-to-earnings ratio than Take-Two Interactive Software, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

95.5% of Take-Two Interactive Software shares are owned by institutional investors. Comparatively, 94.5% of Roblox shares are owned by institutional investors. 1.3% of Take-Two Interactive Software shares are owned by insiders. Comparatively, 12.9% of Roblox shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Take-Two Interactive Software and Roblox, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Take-Two Interactive Software	1	2	19	0	2.82
Roblox	3	7	20	0	2.57

Take-Two Interactive Software presently has a consensus price target of $251.60, suggesting a potential downside of 2.37%. Roblox has a consensus price target of $128.31, suggesting a potential downside of 3.83%. Given Take-Two Interactive Software’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Take-Two Interactive Software is more favorable than Roblox.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Take-Two Interactive Software	-72.92%	7.33%	2.81%
Roblox	-23.67%	-372.96%	-13.06%

About Take-Two Interactive Software

Take-Two Interactive Software, Inc. develops, publishes, and markets interactive entertainment solutions for consumers worldwide. It develops and publishes action/adventure products under the Grand Theft Auto, LA Noire, Max Payne, Midnight Club, and Red Dead Redemption names, as well as other franchises. The company also publishes various entertainment properties across various platforms and a range of genres, such as shooter, action, role-playing, strategy, sports, and family/casual entertainment under the BioShock, Mafia, Sid Meier’s Civilization, XCOM series, Borderlands, and Tiny Tina’s Wonderland names. In addition, it publishes sports simulation titles comprising NBA 2K series, a basketball video game; the WWE 2K professional wrestling series; mobile titles, including WWE SuperCard; and PGA TOUR 2K. Further, the company offers Kerbal Space Program and OlliOlli World; free-to-play mobile games, such as CSR Racing, Dragon City, Empires & Puzzles, FarmVille, Golf Rival, Harry Potter: Puzzles & Spells, Match Factory!, Merge Dragons!, Merge Magic!, Monster Legends, Toon Blast, Top Eleven, Top Troops, Toy Blast, Two Dots, Words With Friends, and Zynga Poker; and hyper-casual mobile titles, including Fill the Fridge!, Parking Jam 3D, Power Slap, Pull the Pin, Twisted Tangle, and Tangled Snakes. Its products are designed for console gaming systems; personal computers; and mobiles comprising smartphones and tablets. The company provides its products through physical retail, digital download, online platforms, and cloud streaming services. Take-Two Interactive Software, Inc. was incorporated in 1993 and is based in New York, New York.

About Roblox

Roblox Corporation develops and operates an online entertainment platform in the United States and internationally. It offers Roblox Studio, a free toolset that allows developers and creators to build, publish, and operate 3D experiences, and other content; Roblox Client, an application that allows users to explore 3D experience; and Roblox Cloud, which provides services and infrastructure that power the platform. Roblox Corporation was incorporated in 2004 and is headquartered in San Mateo, California.