- Reaction score
- 1,697
Nintendo (NASDAQOTH: NTDOY.PK) has long been one of the chief players and innovators in the videogame industry. The company has been credited with bringing the videogame market back from the verge of complete collapse and maintains one of the most iconic and valuable casts of characters in the medium.
It is my position that Nintendo stock is currently overvalued at a price of around $17. Nintendo has seen an rise in the valuation of its stock over the course of the last year, however there are many indicators suggesting that such positive momentum is unsustainable and that its stock price will drop.
The company’s rising stock price has been driven largely by the solid performance from its 3DS handheld. The system has been putting up good numbers in all of the major territories, securing the top spot on June’s NPD charts and topping the Japanese trackers on a weekly basis. Recent releases such as Animal Crossing and Luigi’s Mansion 2 have shown strong performance and signs of franchise growth. The value of Nintendo has climbed over 25% over the last year. The last month in particular has shown incredible growth for the company. Yet, if the stock is climbing in response to good sales from the 3DS and key Nintendo franchises, such action appears shortsighted.
Nintendo’s Wii U console stands to become one of the biggest flops the company has ever released and has the potential to be the last home console it ever produces. After a decent launch performance, sales of the console have slowed to a veritable crawl. While hardware sales have been undeniably disastrous, it is software sales that show that the console has no future. In the sixth months that the Wii U has been on the market in the UK, total software sales tallied only 179,000.
More here: http://beta.fool.com/keithnoonan/20...-trouble-ahead/41614/?source=eogyholnk0000001
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I think this article highly underestimates the power of the portable. These same people were saying the same thing when 3ds came out. If Nintendo would come through with some 1st party title support for the Will U, that would start selling consoles.
It is my position that Nintendo stock is currently overvalued at a price of around $17. Nintendo has seen an rise in the valuation of its stock over the course of the last year, however there are many indicators suggesting that such positive momentum is unsustainable and that its stock price will drop.
The company’s rising stock price has been driven largely by the solid performance from its 3DS handheld. The system has been putting up good numbers in all of the major territories, securing the top spot on June’s NPD charts and topping the Japanese trackers on a weekly basis. Recent releases such as Animal Crossing and Luigi’s Mansion 2 have shown strong performance and signs of franchise growth. The value of Nintendo has climbed over 25% over the last year. The last month in particular has shown incredible growth for the company. Yet, if the stock is climbing in response to good sales from the 3DS and key Nintendo franchises, such action appears shortsighted.
Nintendo’s Wii U console stands to become one of the biggest flops the company has ever released and has the potential to be the last home console it ever produces. After a decent launch performance, sales of the console have slowed to a veritable crawl. While hardware sales have been undeniably disastrous, it is software sales that show that the console has no future. In the sixth months that the Wii U has been on the market in the UK, total software sales tallied only 179,000.
More here: http://beta.fool.com/keithnoonan/20...-trouble-ahead/41614/?source=eogyholnk0000001
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I think this article highly underestimates the power of the portable. These same people were saying the same thing when 3ds came out. If Nintendo would come through with some 1st party title support for the Will U, that would start selling consoles.
