Take-Two Interactive Software Inc. (TTWO), whose competitors include Activision Blizzard, Inc. (ATVI) and Electronic Arts, Inc. (ERTS), has traded in a narrow range over the last twelve months. The 52-week low on the stock is an even $7; the 52-week high is $12.57. The stock closed Tuesday's session at $10.52. After the bell, the video-game publisher reported results for the second quarter. Shareholders can be thankful that the bottom line experienced a significant improvement.

On an adjusted basis, the company made 34 cents per share from continuing operations versus a loss of 4 cents per share from continuing operations in the year-ago period. Net revenue jumped over 50%.

Electronic Arts (ERTS), a video-game publisher that competes with Activision Blizzard (ATVI), THQ (THQI), and Take-Two Interactive (TTWO), is being sold off as I write this during the afternoon session. Shares of EA are down $1.16, or over 6%, to $17.64. Volume? It's up there.

As we all know, EA has had its share of problems in coping with the slowdown seen in the growth of the gaming console industry. In addition, internal challenges have plagued the company's business model. The one-year chart is not a convincing graphic; if anything, it tells you to stay away.

It's easy these days to get excited about video game stocks. But investors should beware: Not everything is what it seems.

Part of the recent enthusiasm around video game stocks comes from game maker Activision's (ATVI) announcement on Thursday that it was raising its guidance for its Q1 results, which will be released on May 6. The company expects earnings of 72 cents per share, up from its earlier forecast of 70 cents per share. Shares were up nearly 4% on the news and the stock is up about 19% for the year.

Nintendo is also the source of some intrigue as it pushes ahead with ambitious plans to bring video games to the classroom and to implement 3D video game technology. Plus, the company is rolling out a souped-up DSi video game console with a bigger screen.

We all talk about the fundamentals behind an investment idea, but sometimes you have to pay more attention to the observed price action. That's what I was thinking today while checking out Activision Blizzard (ATVI).

I have been watching this publisher of entertainment software closely as of late, wondering if it was time for me to get back in. Compared to other similar companies such as Electronic Arts (ERTS) and Take-Two Interactive (TTWO), I think Activision Blizzard offers the best potential for both the console market and online gaming.

After a disappointing February video game sales report, many analyst insiders are predicting a strong month in March for top video game stocks Electronic Arts (ERTS), Nintendo (NTDOY), Sony (SNE) and Take Two Interactive (TTWO).

The biggest reason is simply because the bar is set pretty low. March 2009 video game sales were down 17% when up against 2008 numbers, and unless the data gets seriously skewed we should see an organic rebound in numbers just from that low. If you'll recall, March 2009 was pretty bad on all fronts -- the economy shed 650,000 jobs, stocks hit a 12-year low, and there was a -6% contraction in GDP for the first quarter of 2009.

With lower expectations, the video game industry may win a reprieve when the March numbers roll out. But on top of those low expectations, a new Nintendo console and a few blockbuster titles should result in decent sales for the industry.

We all have our watch lists. I'm no different. Here are four companies that I monitor almost every single day, and a brief opinion on each of them.

Activision Blizzard (ATVI): I sold this one back in January. Some believe I was wrong to do so. I definitely comprehend the sentiment, because really, this is the best publisher in the sector. Compared to Electronic Arts (ERTS) and Take-Two Interactive (TTWO), Activision Blizzard has an enviable pipeline. Unfortunately, the video-game industry isn't firing on all cylinders; check out the most recent monthly-sales report, and you'll see what I mean. In addition, the company's Guitar Hero franchise isn't the fad it once was. I do want to get in on the stock again, though; lately, the price seems to be perking up. I'm not ready to send in the buy order just yet. I'm waiting for further strength to materialize in the shares.

Here are some highlights from this past week's earnings coverage on BloggingStocks:

• AutoZone Inc. (AZO) reported better-than-expected Q2 earnings, as well as sales and gross margin growth.
• Big Lots Inc. (BIG) beat Q4 earnings expectations, raised its guidance, and lifted its share repurchase program.
• Carmike Cinemas Inc. (CKEC) swung to better-than-expected profit in Q4 and reported strong sales growth.
• Ciena Corp. (CIEN) reported a bigger-than-expected Q1 net loss and some revenue growth, and offered guidance.
• DISH Network Corp. (DISH) posted a year-over-year increase in Q4 revenue but also a decline in per-share earnings.

Take-Two Interactive (TTWO) is the kind of stock I want to take a chance on but just can't bring myself to do so. The situation can be risky unless a fresh bit of Grand Theft Auto content is about to come out into the marketplace. Then again, those who bought ahead of the Q1 earnings report, released yesterday after the bell, are pretty overjoyed this afternoon, seeing that the stock is, at the time of this writing anyway, up well over 9%.

Net sales increased 9%. The adjusted loss from continuing operations was 31 cents per share. Last year at this time, shareholders were looking at a loss of 56 cents per share on the same basis. Reuters says the analyst call was for the red ink to equal 51 cents per share. Good job, management.