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  • narumtr narumtr Jan 21, 2013 3:09 PM Flag

    Nintendo’s Wii U problems turn into a crisis

    That article's poor speculation and logical fallacies aside, my opinion is that the market has already largely priced the WiiU's poor early showing into the current stock price. The entire industry is really slow right now. The 3DS is doing well considering and Nintendo has some massive titles coming out for it this year. System sellers like Pokemon X&Y. Also Nintendo has stated they are back to making profit on 3DS sales after the price-cut.

    The Wii U is having a slow start but that doesn't define its success long term. The X360 had 19 titles at launch and fewer titles by June 2006 than Wii U has now. Only 4 of its launch titles went on to sell over 1 million lifetime with its top launch title COD not clearing 2 million lifetime. Super Mario will pass that this year alone as will Nintendoland. X360 was launching during a great economy and still was behind sales of PS2. It also was clearly launched exclusively at the mature gamer with almost all of its titles of the more mature type. That type of gamer is far more likely to be an early adopter in my opinion than the majority of Nintendo's base and yet the 360 sold less in its first 3 months than the Wii U

    A lot of people will wait to buy Wii U until MS and Sony announce their consoles. Also a lot of people will wait for a Zelda, Mario, etc. Finally families etc. simply wait for prices to drop. If Wii U doesn't do well next holiday season then it's time for articles such as that but even then may be too early depending on the market and pricing (for instance Vita has had 2 holiday periods and done poorly but may rebound if it integrates well with PS4 and Sony drops the price and gets more great games for it).

    In my opinion Wii U worst case is GameCube like numbers. Considering the majority of those 20 million consoles would make money (launch and maybe at initial price cut excepted) I still think Nintendo would at least break-even all-in. That would maybe force them to abandon home consoles and publish only games - but even if that happens I think their IP alone is worth more than the $1.5billion it would need to justify its current price.

    It's hard to imagine Microsoft wouldn't pay at least $2B to get their hands on Nintendo which would open the Japan market to them where they get trounced by Sony and Nintendo. Not to mention that if either Sony or MS got Mario, Zelda etc. in a buyout they would likely be guaranteed to win the following generation.

    Sentiment: Strong Buy

18.00-0.17(-0.94%)May 27 3:59 PMEDT