Roblox (NYSE:RBLX – Get Free Report) and Take-Two Interactive Software (NASDAQ:TTWO – Get Free Report) are both large-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, dividends, earnings and analyst recommendations.
Profitability
This table compares Roblox and Take-Two Interactive Software’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Roblox | -23.67% | -372.96% | -13.06% |
| Take-Two Interactive Software | -72.92% | 7.33% | 2.81% |
Earnings and Valuation
This table compares Roblox and Take-Two Interactive Software”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Roblox | $3.60 billion | 22.70 | -$935.38 million | ($1.43) | -88.65 |
| Take-Two Interactive Software | $5.63 billion | 8.25 | -$4.48 billion | ($23.94) | -10.53 |
Roblox has higher earnings, but lower revenue 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
94.5% of Roblox shares are held by institutional investors. Comparatively, 95.5% of Take-Two Interactive Software shares are held by institutional investors. 12.9% of Roblox shares are held by insiders. Comparatively, 1.3% of Take-Two Interactive Software shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of current ratings for Roblox and Take-Two Interactive Software, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Roblox | 3 | 6 | 20 | 0 | 2.59 |
| Take-Two Interactive Software | 1 | 2 | 19 | 0 | 2.82 |
Roblox currently has a consensus target price of $126.84, indicating a potential upside of 0.05%. Take-Two Interactive Software has a consensus target price of $251.60, indicating a potential downside of 0.15%. Given Roblox’s higher probable upside, equities research analysts clearly believe Roblox is more favorable than Take-Two Interactive Software.
Risk and Volatility
Roblox has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500. Comparatively, Take-Two Interactive Software has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.
Summary
Roblox beats Take-Two Interactive Software on 8 of the 14 factors compared between the two stocks.
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.
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.
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