With the NASDAQ and Dow Jones Index down 6% and 4%, respectively, two video game publishers have seen their shares beaten down to a bloody pulp in the last month – THQ Inc. (NASDAQ:THQI) and Take Two Interactive (NASDAQ:TTWO). Competitor Electronic Arts (NASDAQ:ERTS), meanwhile, was down 4% in the same period.

THQ issued a weak quarterly update which sent its shares down beginning in early August.  Take Two investors must have been paying close attention, because Take Two’s plunge occurred almost in lockstep with THQ shares.  Last week, a few THQ insiders followed up by purchasing shares from the open market.  The market has not since reacted to those modest sized insider trades.

Take Two investors have not seen a company warning, but have been nervous about a number of other items, including a recent game delay and less-than-expected contribution from their new hit title, Red Dead Redemption.  Some are also speculating that the secretive Rockstar Games studio plans to push the next installment of Grand Theft Auto into 2012.  Others have been disappointed by recent review scores of their new title, Mafia 2.  On top of that were THQ and Activision’s warnings.  Some investors were also quietly hoping that the less-than-expected contribution from Red Dead Redemption would be countered by a positive pre-announcement last month from Take Two management about earnings.  That did not happen.  Instead, the company missed analyst monthly sales expectations for July, which was when Take Two shares began to slip.

It’s interesting to note that Take Two shares trade at the same hefty discount to sell side analyst price targets as THQ shares at this time, suggesting the market holds a similar pessimistic view on both companies.  However, the two companies could not be in a more different position than they are in today.  Publishers increasingly admit that they are becoming reliant on a small handful of blockbuster internal properties with…