Wedbush Morgan analyst Michael Pachter's Magic 8-Ball is just full of gloom and doom today. Not only does he believe that Halo 3 is going to cause a couple weeks of delay for GTAIV, but that some bad stuff is going to go down during Take-Two's June 11 earnings call. Pachter says to expect studio closures, lease terminations, game cancellations and just general un-good things.Pachter says, "We believe that new management understands what is required to turn the company's fortunes around, and believe that they will take prudent steps to return the company to profitability. However, we believe that there are significant structural changes required in order to control costs ... new management is saddled with the decisions made by the prior management for at least another year, and we do not expect new games such as The Bigs, All-Pro Football, Fantastic Four, or The Darkness to be wildly profitable."
Pachter says that Take-Two is currently overvalued and advises shareholders to sell. Pachter concludes in a fantastically geeky/cerebral way saying that loyal shareholders are stuck in a prisoner's dilemma. They can stay and hope the company turns it around a year from now, or they can drop the shares and then everyone loses ... once again, Pachter says to cut and run.
