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Nintendo Co. Ltd. Message Board

  • r0bdunlop r0bdunlop Dec 17, 2007 7:48 PM Flag

    Great company, but the stock is overvalued. Some thoughts...

    I'm happy to have made money on NTDOY, from 2006-07, buying in at $20. At that price, it was a steal. NTDOY was about to dominate the handheld market with the imminent release of the DS Lite, and the Wii was just what the industry needed. So now Nintendo is king. Yay! Well done them, they've played this brilliantly.

    HOWEVER, you can't be king of the consoles forever. While the DS will continue to reign supreme for the forseeable future, the Wii's days as King are numbered. Japan has already lost its appetite for the machine, while Europe and America are still going crazy for it - for now. Yup, crazy for this new wonderful toy. And that's what the Wii is. A Toy. The 360 and, yes, the PS3 will gain considerable ground in the coming months and years, as AAA titles excite gamers across the globe. The Wii, however, is still reliant on 1st party software and the hardware will seem increasingly antiquated as time goes on. It's selling because it's new, it's cheap and the concept is amazing. Shame about the execution - the games are almost all terrible.

    Tomorrow I'll be selling my Wii. The Wii got me back into gaming, but the XBOX 360 has showed me what is possible. Japan will slowly shift over to the PS3 now (actually, it's already happening). When GTA4 appears in spring 08, then the Wii will start to look a lot less attractive in the USA/Europe, and MILLIONS of new consumers will flock to the more powerful 360/PS3 consoles.

    Congrats to everyone who has made money on NTDOY. But I hope you will understand that the peaks are over for this stock, barring irrational exuberance (which is possible, but not worth betting on). I have no position in NTDOY, nor do I have the facility to buy or sell NTDOY anymore, as I closed my US trading account (I'm in the UK, and opened the account just to buy NTDOY). You can look back at many of these games stocks and see massive spikes when it seemed like they could do no wrong. Right now, the market sees Nintendo as a permanent growth story, as the saviour of the games industry, as the Apple of video games. Well, get in your time machine, go forward 3 years, then look back at these lofty prices and chuckle. Because with no handheld competition to speak of, a dominant position in the home console market, and Wiis selling out everywhere, perception for Nintendo is AS GOOD AS IT CAN POSSIBLY GET. There is no perception upside from here. As the reigning king, Nintendo can only disappoint going forwards.

    The Wii is not the next ipod, it's more like a really amazing Tickle Me Elmo, and I don't believe this global enthusiasm will continue for much longer.

    Last time I checked Nintendo had become the 2nd biggest company in Japan, by market cap. It's now considerably bigger than Sony (which was twice as big as NTDOY, not so long ago). Where can it go from here?

    Right now, I hold a single video game stock (actually, I have a spread bet position). TTWO - it's cheap, it's a takeover target in the light of the ATVI-Blizz deal, GTA 4 hype is still to come and that game will be HUGE, and it's got a great new IP in Bioshock. It's reporting earnings tomorrow, which I expect will please the market, and hopefully updating us re GTA.

    Other than TTWO, ERTS is possibly worth keeping an eye on, but I think ATVI is expensive. THQI is one to avoid at all costs, IMHO, because its licenses will be taken back by the licensors over the coming years, leaving its business model severly hampered.

    Hope someone's listening out there. Just sharing my humble thoughts!!

    Rob

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    • down nearly five points. see the trend?

    • You really are an idiot sql. . .it's amazing for you to be so blind to it as well.

      Like to wager that NTDOY (% wise) is higher 4 months from now than Sony? Loser doesn’t post on the NTDOY board anymore?

      Hell you pick the time frame, as long as it's shorter than 4 months and longer than 2 weeks. I'd prefer not to read your gibberish or see the competent posters respond to your incompetence.

    • You know there is a difference in what I investment. I know when I invest in Sony, I know my money working towards new technology. I can't say for wii technology but, you will hear and read about Sony good and bad but nothing about NTDOY, rarely anything, no wonder its pin.

      Sony stock is averaging from mid 40s and mid 50 but, its avg. trading is going up for profit taking, NTDOY dropped from the near might 80s and its trading avg I don’t see going up, maybe a point or two when Monster Hunter 2 is release by capcom but, that will last four about one quarter to make a short interest. Shorts have their eyes on NTDOY, for Sony trade value it always has good volume for trading, so I am happy.


      http://youtube.com/watch?v=e3FVLyzmNAI

      You think the majority will get tired of rehashed games/P

      Read http://www.nexis.com/research

    • Have you seen the ride down from 75 and dropping, where do you expect to bottom out?

    • Hey, look, as well as saying sell Nintendo, I said avoid THQ at all costs. One month before their big profit warning.

      As for TTWO, it's still cheap.

      As for ERTS, I'm still looking. Can we see $40? If so, I'll probably pile in. Sony, too, if it falls another 20% might be an interesting play.

      Nintendo may fall further in the short term, or it may bounce back to $60. If it does the latter, then I hope some of you guys will see it as an opportunity to move on to pastures new.

      Good luck to all.

      Rob

    • I sold at 75 and I dont regret. My friend Psyche who has accompanied me on Sony B assures me I'm nuts but after doing my own DD and past trends factoring HD moment, 2008 belongs to other console and PS3. It was a great ride but the ride is over. PS - I find the wii fun too. My advise own SNE before 80s.

      • 2 Replies to sql1433
      • sql has never owned NTDOY. He has been pumping Sony over on that board for a long time. I was nice and did not bash sony on his board. Pchz knows this guy they used to go at it all the time. At least Pchz did not portray himself as a former SNE long that recently switched to NTDOY. I mean come on guy, you didn't think that me and Pchz would be on this board?

        "Smell that Rabbit? Fear."

        Tam

      • Agree - Nintendo has done great, but for those who want equity growth, it's time to move on. Sony looks quite tempting, however, and I also think it will do well this year. Everything is starting to come together - finally - for the PS3. The Bluray's success will help the hardware a lot, as people (like me) finally make an investment in HD movie tech.

    • No more Heroes
      Monster Hunter 3
      Endless Ocean
      Winning Eleven for the Wii
      Star Wars: The Force Unleashed

      These announced games slated for 2008 seem to be winners for NA in my eyes...

      We'll see what surprises will be revealed in march GDC and at E3 2008.

    • Nintendo has vowed to have robust 3rd party sales this generation. There a a few hit 3rd party titles already, and maybe more will be established this year.

    • Looking at the P/S ratio, Nintendo's is 8.5, Softie is a bit oget 6, and Sony is less than 1. This suggests that Nintendo is overvalued. However, looking at the P/E, Nintendo's has bee dropping, even as its market cap had surged! In the very long run Sony may be a better buy, but as long as Nintendo earnings are growing, it is still a great stock to own.

      • 1 Reply to ellensprophet
      • Someone has mentioned this before but the Wii is tapping into an audience that normally does not play games. The wii is becoming more a household staple device. It's being used as an educational tool, a rehabilitation tool, an exercising tool and the sort. Yes the stock is overvalued at this point and if you compare it to the likes of PS2 sales in the past and do any sort of analysis it may seem incredibly expensive. However....as I'm seeing the trend of Nintendo, it seems as if it could POSSIBLy (not definitely) become another Apple like brand that transforms a common product to the entire mass. Japan has an incredible hard core gaming audience....and I don't think that this is the audience that Wii truely appeals to. This company has the potential to tap into a niche market that no gaming company has yet successful penetrated....the average person who doesn't play any games. The games that came out so far may be disappointing to the hard core gaming audience, but from what i hear from non-gamers who bought the wii, they are fascinated with this system. I'll take my chances and keep this stock for a bit longer to see how it plays out. I'm not sure whether or not sales in Japan for this system has dropped, but I think it's ridiculous to say that just b/c it dropped over in Japan that its sales will drop all over the world. The markets, the target audience, and consumer expectations from each country are very different.

    • Show me what shelves or send a link of where and I'll buy about 10 Wii's then sell them on EBAY for about $500 each(and buy more NTDOY stock).

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NTDOY
13.27-0.20(-1.48%)Dec 19 3:59 PMEST

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