It was only recently that analysts sang high praises for New Jersey-based Majesco Games (ticker: COOL), seeing impending growth as a result of some strategic moves. Majesco took a few gambles and scooped up the Psychonauts license after it was dumped by Microsoft, spent a bundle on the epic sci-fi shooter Advent Rising, and acquired the rights to Taxi Driver.
It turns out some of those gambles aren't paying off, in the eyes of investors, at least.
According to finance site MarketWatch.com, after lackluster sales of Psychonauts and Advent Rising, and a downgrade from outperform to perform by JMP Securities, shares of Majesco today fell 15 percent to $6.15, after yesterday's close of $7.25.
JMP analyst Ingrid Ebeling cites a poor retail showing by Advent Rising (Xbox), which Majesco spent millions promoting, and Psychonauts (Xbox, PC, and PlayStation 2). Ebeling remained unchanged on her projected earnings for the company but said the publisher would need to have strong showings from its Game Boy Advance games for a subsequent change to her rating to occur.
The road out of red has been a long one for Majesco. The company saw a dramatic turnaround for Q2 this year, with an increase of $3 million in revenue over the same quarter a year earlier.