Consolidation in the video game sector: Too soon to think about?

According to the Los Angeles Times, it is possible to interpret recent comments from Iger as evidence that Disney won't be making a big move in this regard. Excellent. I own shares of Disney, and I have no idea how the company would efficiently integrate a gaming entity into its portfolio of businesses. What, I have no imagination, you say? I'd have to respectfully disagree. Iger already has his hands full turning around his movie operations. Plus, there's Marvel (MVL) to think about. Let's get through that acquisition first before turning to publishers, okay?

This doesn't mean that consolidation isn't going to happen. Oh, I believe it will. When you see THQ Inc. (THQI) trading at below $5 per share, you've got to believe someone is going to take the company out of the market.

And who will step up to grab Take-Two Interactive (TTWO)? Have you retrieved a quote on that company lately? At below $10 per share, and a current market cap of less than $650 million, a cash-rich conglomerate might find owning Grand Theft Auto highly appealing.

As I've stated before, THQ looks to be the best idea in terms of the acquisition thesis. But it could be too soon to think about buying on such speculation. Managers may believe that better values are ahead as the sector continues to work through its current troubles.

Still, those who are adventurous with a small portion of their investment dollars are probably taking a look at THQ and Take-Two. You never know when it's going to happen, but consolidation can be exciting. Big warning, though: don't buy without doing a lot of due diligence, and only buy if you think the company you are speculating will be taken over is a value without the acquisition thesis attached. Always understand the risk.

Disclosure: I own Disney; positions can change without notice.