Downgrade doesn't dent THQ stock

[Cintaria]

Despite JP Morgan's rating downgrade, the plucky publisher's share price rises on news it is the year's number-two publisher to date.

Typically, when one of the country's top financial institutions downgrades a company's stock, its share price falls through the floor. Today, though, THQ Inc. (NASDAQ: THQI) bucked the all-too-common trend. Despite having its stock downgraded by JP Morgan ("overweight" to "neutral"), the company saw its share price rise slightly, ending the day up $0.32--1.44 percent--at $22.55. Its stock was down a similarly small amount in after-hours trading.

A possible reason for the nonimpact of Morgan's rating was a press release issued by THQ just hours after the downgrade. Bearing the self-explanatory (and unwieldy) headline "THQ #2 Independent Video Game Software Publisher Year-to-Date in U.S. and U.K. Markets According to NPD Group, UK Chart-Track," the release touted the fact that through the end of August, only one other third-party publisher sold more games than THQ in North America and Great Britain.

As was to be expected, the release contained some self-congratulatory language from a THQ executive. "Our leadership is the result of THQ's strategy to build on our long-term sustainable brands by introducing innovative new original properties with broad global appeal," said president and CEO Brian Farrell. "We plan to build on the recent success of Destroy All Humans! and Juiced by creating innovative, new original games for the Xbox 360, such as Saint's Row and The Outfit, as well as critically acclaimed original titles for Windows PC, including Company of Heroes, Supreme Commander, and Titan Quest."

Unsurprisingly, THQ's release did not identify the number-one third-party publisher of the first eight months of 2005. The company in question is likely either Electronic Arts, the traditional top dog, or Take-Two Interactive, which had been enjoying record sales of Grand Theft Auto: San Andreas until the game was forced off store shelves in late July.

News from GameSpot.com