Competition in the games industry has heated up in 2022 as multiple companies have altered the industry's landscape by acquiring different studios. Microsoft (MSFT 2.96%) kicked off the trend in January when it announced plans to acquire Activision Blizzard (ATVI) for a historic $68.7 billion. Sony (SONY -0.21%) has also joined in by snapping up four game studios over the year, with its biggest being Bungie for $3.7 billion. 

While Microsoft and Sony's acquisitions have been fueled by the ongoing console wars, Take-Two Interactive's (TTWO 1.31%) purchase of mobile gaming giant Zynga for $12.7 billion has helped it diversify its offerings and join a lucrative part of the market. The company's stock has dipped almost 35% since January on the back of a decrease in consumer demand across the tech industry and a dismal quarter because of its pricey acquisition of Zynga.

However, Take-Two is a solid buy for the long term thanks to a valuable content catalog and projected market growth. Let's assess. 

A lucrative content library 

Take-Two has become one of the leading companies in the game industry with the success of its two biggest publishers: Rockstar Games and 2K. These studios are responsible for some of the world's most profitable franchises, including Grand Theft Auto (GTA), Red Dead Redemption, and NBA 2K. However, Take-Two primarily owes its position in the market to the immense success of its 2013 game, GTA V. 

The game has had a lasting presence in the industry, becoming the fastest entertainment release to earn $1 billion. Then in 2018, GTA V became the most financially successful media title of all time when it reached $6 billion in revenue. Even Minecraft, the best-selling game of all time by copies sold, has reached half of that figure at $3 billion.

Almost a decade after its release, Take-Two earns $911 million a year from GTA V through added content, re-releases on multiple generations of platforms, and micro-transactions. Additionally, the company is currently developing the next installment of the GTA franchise, which will likely provide a significant boost to revenue when it launches within the next few years. 

Moreover, Take-Two's acquisition of Zynga has brought many popular mobile titles into its fold, with its 10 most popular titles earning a combined $808.28 million in 2021. Take-Two was already a strong force in the industry before it purchased Zynga, but the acquisition has elevated its business and made it more competitive against such companies as Electronic Arts and Activision Blizzard.  

Promising market growth

Despite slowing consumer demand across the tech market, analysts expect the games industry to grow 36.2% from $235.7 billion in 2022 to $321.1 billion in 2026 -- a rise of about 9% a year. Gaming is an increasingly popular pastime, attracting about three billion players worldwide in 2021, making it one of the worlds biggest entertainment markets. 

Furthermore, the rise of game subscriptions, streaming, and the use of in-game purchases has opened new avenues of revenue growth outside of game sales. Take-Two has built added security within its business, offering its games across multiple consoles and platforms, which is especially relevant in 2022 as the PC market has seen a steep decline while game consoles continue to see record sales. 

Take-Two's acquisition of Zynga has furthered this security, with the company adding revenue from the booming mobile gaming market. According to Statista, the mobile gaming content market value will rise from $149.5 billion in 2022 to $173.4 billion in 2026. The meteoric rise of mobile gaming over the years can also be seen through Zynga's revenue growth over the years, more than doubling from $907.21 million in 2019 to $1.9 billion in 2020. 

Is now the best time to buy Take-Two stock?

Take-Two's stock has fallen 9% in the last month on the back of a disappointing quarter and leaked footage for its upcoming GTA game. However, the company has an excellent long-term outlook. On Oct. 6, Goldman Sachs upgraded its recommendation from neutral to buy, explaining that despite near-term hurdles, the company has potential for patient investors. 

With a valuable content catalog that has proven ability to generate revenue from a single title for almost a decade and a promising venture into mobile gaming, Take-Two stock is a great buy for investors in it for the long haul.