Cowen analyst upgrades Take-Two

Analyst Doug Creutz upgraded Take-Two to "Outperform" from "Neutral," though he noted that a contract renewal for key employees at the company's Rockstar Games label remains a risk. Rockstar is behind the popular "Grand Theft Auto" franchise, Take-Two's main source of revenue. A contract with brothers Sam and Dan Houser, who head Rockstar, expires in February.

"If Rockstar's key talent decides to leave, TTWO shares would likely be negatively impacted," Creutz wrote.

The analyst said he liked Take-Two seven months ago when they were trading below $20--before a failed buyout bid from larger rival Electronic Arts Inc. And the company's business has improved since, he added.

"Prior to EA's February bid, we were positive on TTWO based on a projected turnaround story (including the successful release of 'GTA IV') that has largely been proven correct thus far," Creutz wrote.

Take-Two's shares were trading around $17 on Feb. 22, the day before EA went public with a $2 billion, or $26-per-share buyout offer. The stock surged following the bid and fell back down after EA walked away earlier this month.

On Monday, Take-Two's shares fell 95 cents, or 5.9 percent, to $15.21 as the broader market sank with the defeat the financial bailout package in the House. The stock has traded in the 52-week range of $13.53 and $27.95.