Take-Two Interactive Share Rating Downgraded

Banc of America has downgraded the rating of Take-Two Interactive, publisher of the 2K Sports line and Grand Theft Auto franchise, from "sell" to "neutral," sending the company's stock prices down $3.29 to a low of $13.64 per share, the lowest the company's stock has been in a year. In addition, Banc of America revised its earnings expectations for the company, saying investors could now expect 59 cents per share rather than 80, and changed the company's share price target from $17 to $12. The bank cited as reasons for the downgrading its belief that the next full Grand Theft Auto game, apart from the PS2 port of Liberty City Stories and the new title on the way for PSP, will not be available until fall 2007. The bank also expressed concern that Take-Two is losing money "at an alarming rate," and could be down to $75 million in cash by spring 2006. The move comes as part of a succession of bad news for Take-Two, as subsidiary company Rockstar has been indicted in Los Angeles over last year's controversial Grand Theft Auto: San Andreas content, and concerns voiced by a board member, leading to her resignation from the company's board of directors.