Video game maker Take-Two Interactive (NASDAQ:TTWO) has had an impressive year with its share price rising to all-time highs. Now that Take-Two stock is sitting just a few dollars from its 52-week high, investors should be wondering whether or not to double down on the gamemnaker or take profits.

On one hand, the stock has a lot of catalysts for growth coming up during the second half of the year, but then again- the firm is also facing a few headwinds like tough competition and regulatory issues in China. 

Here’s a look at the pros and cons of investing in Take-Two.

Pro: October Looks Bright

One big reason investors are holding on to Take-Two stock despite its recent jump is that October looks like a bumper month. Take-Two has some highly anticipated game releases likely to send the share price upward.

The firm is due to release Red Dead Redemption 2, which has been getting a lot of buzz in the lead up. The company’s original Red Dead Redemption game was a hit and looks like it could become a major franchise for Take-Two. 

The new game is expected to have a slew of downloadable content as well, something CEO Strauss Zelnick says has been a major boon for its Grand Theft Auto franchise.

Adding downloadable, online content gives the firm a way to stretch even more sales from its releases and Red Dead will follow in those footsteps with opportunities for gamers to add additional content to their gaming experience through online downloads. 

Con: TTWO Isn’t the Only One

While October looks like it could be a bumper month for TTWO stock, it’s important to note that Take-Two isn’t the only one slated to push out new games this fall.

Releases from competitors like Activision Blizzard (NASDAQ:ATVI) could take some of the shine away from the Red Dead rollout as the firm is also due to launch a new version of its Call of Duty game series.

On top of that, Electronic Arts (NASDAQ:EA) is also slated to introduce a new Battlefield game. The three game makers will all be vying for attention at the same time and depending how the games are received, it could have a negative impact on TTWO stock.

Pro: Strong Finances

Take-Two stock is expensive compared to its peers EA and ATVI. TTWO’s P/E of 82.03 is nearly double that of EA’s 43.18 and far surpasses ATVI’s 50.45. However, there’s a good reason for that- Take-Two has a solid financial base compared to the rest of the field, making it a much safer play than either EA or ATVI.

The company’s debt to equity ratio is just 0.28% compared to 18.88 and 42.47 for EA and ATVI respectively. The company’s free cash flow has been steadily increasing as its game franchises gain momentum, which leaves additional room for investment as well as added padding in case of a crisis. 

Con: Expectations Are Baked In

If you don’t already own Take-Two stock and you’re thinking about taking a position now, it’s important to note that the company’s bright outlook has been baked into TTWO’s share price.

In recent quarters, Take-Two management has been optimistic about the company’s future which in turn has sent the share price higher. Not only has guidance for the back half of the year been rosy, but the firm has been conducting share buybacks.

So far this year, the company has repurchased $308 million worth of Take Two stock, something many weren’t expecting considering TTWO’s assent. Zelnick has always been conservative about his spending on buybacks, saying that he wouldn’t consider buying shares unless they were discounted.

Those factors have created a lot of optimism for Take Two, and although the company looks to have a bright future, a lot of what’s to come has already been taken into account.

The Bottom Line on Take-Two Stock

Take Two stock is definitely a solid bet in the gaming space. The firm’s strong financials and promising portfolio of games makes it one of the most stable companies you can buy into.

TTWO’s upcoming releases also look likely to be well received, which would be another boon for the stock. However, I believe that a lot of those expectations are already reflected in the company’s current share price and I wouldn’t expect to see the share price rise much higher in the months to come.

If Take Two stock sees a pullback next month, I’d consider taking a position, but right now I think the firm is fully valued.

As of this writing Laura Hoy did not hold a position in any of the aforementioned securities.