Dawn Kawamoto over at DailyFinance wrote an article discussing THQ Inc. (THQI). She brings into focus a licensing deal between the video-game publisher and Mattel, Inc. (MAT). There was also mention of the incredible price action in the stock. So, what are investors to make of the thesis? What about traders?

This is a tricky one. And I've been wrong about THQ's prospects before. It's certainly difficult to predict the movement of a stock that's priced in the single digits. At the time of this writing, the shares were trading at a quote of $6.26.

There are always interesting stories in the marketplace. Today, I'm going to briefly comment on the price movements of three that I am watching.

Activision Blizzard (ATVI) is currently down 3% to $11.52, with significant volume backing the sell-off. Down, is that right, you ask? Yes, I'm afraid it is. I know: Call of Duty: Black Ops is doing excellent business. Millions of copies have been sold, and hundreds of millions of dollars have been grossed. Unfortunately, when it comes to trading on such news, the best bet is to sell out on any anticipatory rise that manifests itself before the event finally occurs.

THQ Inc. (THQI) reported earnings for the fiscal second quarter last week. How does the stock look after the numbers?

Well, to begin with, we're dealing with an equity that is priced in the single digits. At the time of this writing, shares were exchanging hands for $4.14. The 52-week low is $3.33 while the 52-week high is $8.29. As can be seen from the chart, the stock has basically collapsed since peaking back in April. If you look at the corporate press release detailing the Q2 data, you may understand what all the bearishness is about. On a non-GAAP basis, the loss per share widened to 60 cents compared to a loss of 37 cents in the year-ago period. Also, the top line experienced a decline.

Analyst Upgrades

• JPMorgan upgraded Smith Micro (SMSI) to overweight from neutral and raised its price target to $15 from $9, citing the release of a WiFi iPad with MiFi from Verizon and Apple.
• Jefferies upgraded Whole Foods (WFMI) to buy from hold and raised its price target to $45 from $36, citing checks that indicate sales are accelerating and the company has been focused on expense control.
• Wells Fargo upgraded Ensco (ESV) and raised its price target to $54 to $56 from $46 to $47, citing valuation, the lifted deepwater drilling ban and higher oil prices.
• Gran Tierra Energy (GTE) was upgraded to buy from hold at Wunderlich, citing the company's Moqueta oil discovery as well as other near-term exploration opportunities, and raised its price target to $12.50 from $7.00.
• Chico's FAS (CHS) was upgraded to buy from hold at KeyBanc and set a $13 price target.
• UR-Energy (URE) was upgraded to buy from hold at KeyBanc.

THQ (THQI), a video-game publisher that competes with Activision Blizzard (ATVI) and Electronic Arts (ERTS), isn't doing well. The stock's chart is pretty bad. I stated in a previous piece that the stock might possibly justify a little speculation for those who have funds earmarked for such investing purposes. Well, I have to say, I think the situation's speculative nature has increased.

Yesterday after the bell, the company reported it lost 21 cents per share on an adjusted basis during the fiscal first quarter. Last year at this time, a profit of 10 cents per share was recorded. Analysts were expecting a loss of 24 cents per share, according to TheFly.

Not long ago, I wrote about THQ (THQI) and its possible value as a speculative play. Well, so far, that idea hasn't worked out too well. At the time of my piece, the stock was trading around the $6.50 level. This past Friday, it closed at $4.10, seven pennies above the 52-week low. Indeed, it's looking very grim for the video-game publisher.

It appeared as if the fundamentals were improving, but it recently suffered a setback. About the middle of last month, Mark Fightmaster covered the details of the company's obligation to lower its outlook for the next fiscal year. The market doesn't like it when this sort of thing occurs.

Early Monday morning, video-game manufacturer THQ (THQI) announced that a stronger U.S. dollar and lower-than-expected sales of UFC Undisputed have caused the company to lower its first-quarter and full-year revenue forecast.

The company now believes it will report full-year net sales in a range of $845 million to $865 million, along with managing to break even on per-share earnings. THQ had earlier forcast net sales to total between $905 million and $920 million with earnings between 25 cents per share and 30 cents per share. As for analysts, expectations were for 31 cents per share with revenue of $913.4 million.

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.

THQ (THQI) has been an interesting stock. The video-game publisher continues to remain in the land of single-digit equities. It used to be a powerful investment vehicle several years ago, but now it unfortunately is an entity more prone to speculative analysis. Will it be taken over? Will a new hit emerge from its pipeline? Will the turnaround effort finally cause all the institutions on Wall Street to buy?

Over the last twelve months, the company has traded in a 52-week range between $4.12 and $9.03. The one-year chart illustrates the rocky road management has traveled in its efforts to get back on track. How does the stock look now that fiscal Q4 numbers have been released?

I'll be honest: the thought of buying Activision Blizzard (ATVI) makes me nervous. First, buying just about any stock right now involves a leap of faith: I mean, how do you know the selling hasn't just begun? Investors are scared, my friends, because of macro issues. However, the second reason I'm hesitant about the software publisher is simply because of the video-game industry itself; the latest console cycle is aging, and the industry is waiting for further catalysts to emerge to make the sector an unambiguous buy once again.

Yet, this company is probably the best out there in terms of what it does. Its pipeline is solid, although not as good as it was. Remember Guitar Hero? What, you've already started to forget? And what about DJ Hero? Did that come and go in the blink of an eye?

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.

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

• Aol Inc. (AOL) reported a better-than-expected Q4 profit and said its revenue also topped estimates.
• Burger King Holdings Inc. (BKC) higher Q2 earnings topped analysts' estimates but same-store sales fell.
• Clorox Co. (CLX) higher Q2 earnings beat expectations and it lifted its full-year earnings guidance.
• Comcast Corp. (CMCSA) Q4 earnings more than doubled and beat Wall Street expectations, but shares fell.
• Gap Inc. (GPS) shares jumped after it forecast earnings above analysts' expectations, boosted by January sales.

THQ (THQI), a video game publisher whose colleagues include Activision Blizzard (ATVI) and Electronic Arts (ERTS), reported very good news this week. For the third quarter, non-GAAP income was 35 cents per share. In the comparable frame, a loss of 14 cents per share was posted.

This obviously represents a vast improvement, although it should be noted that it didn't come on the back of a big sales increase. On a reported basis, the top line was flat, and on a non-GAAP basis, it was down more significantly. This is important to note, because it would have been nice to have read about a revenue expansion, considering the way the gaming industry has been suffering.

The video game industry, as we are all aware, has taken a sharp turn from momentum growth. The various stocks in the sector, from my standpoint at least, are now becoming value-oriented plays. When this happens, the concept of consolidation comes into focus.

Trying to pick a stock that will experience a pop on a buyout is not for the faint of heart, or the impatient. And depending on the stocks you own, you might be hoping that you don't become involuntarily involved in an arbitrage scenario. That's why I was pleasantly relieved when I read an article stating that The Walt Disney Company (DIS) CEO Bob Iger may not be interested in purchasing a software publisher.

Activision Blizzard (NASDAQ: ATVI) published third-quarter results on Thursday after the bell. I can't say I was wholly taken with them. I know the best is probably yet to come once the Christmas shopping season really gets under way, but I was a little disappointed that the company saw a decline in adjusted profit.

Excluding items, Activision Blizzard made 4 cents per share this quarter versus the 7 cents per share made in last year's similar period. Well, did I say I was a little disappointed? Make that a lot disappointed. After all, this is supposed to be the publisher with the best pipeline on the block, the one with the Guitar Hero franchise and a great portfolio of licensed intellectual properties.