Analyst: Guitar Hero yet to peak

Sales of Guitar Hero World Tour have been lower than analysts expected this year, but don't label the franchise a has-been just yet. In a note to investors today, Signal Hill analyst Todd Greenwald said Activision's rhythm game series hasn't even peaked.

Greenwald acknowledged that World Tour sales have been "a bit soft," saying Activision is likely to miss targets for the game. The stand-alone game and guitar bundles in particular are trailing the success of last year's Guitar Hero III: Legends of Rock, Greenwald said.

"Despite this 'weakness,' we disagree strongly with those who contend that Guitar Hero is a 'fad' or that the franchise peaked last year with [Legends of Rock]," Greenwald said.

In fact, Greenwald projects that total Guitar Hero sales will be up more than 20 percent in North America this year thanks to franchise extensions like Guitar Hero: Aerosmith and Guitar Hero: On Tour. Looking to next year, Greenwald expects those kinds of extensions to continue to provide significant growth for Activision. DJ Hero, Guitar Hero: Metallica, and the rumored Guitar Hero: Jimi Hendrix were among the spin-offs Greenwald noted as potential 2009 hits for the series.