Nintendo's market capitalisation is now over $53 billion.

[Kryton]

Oh, I just found this old conversation I had with a friend of mine regarding the Nintendo stock. It was at $34 at the time, and I had just purchased my batch.

Session Start (Me:Him): Tue Feb 06 13:26:01 2007
[13:26:06] Him: not bad at all
[13:26:26] Me: i had an original price target/expectation of $40 by the end of this year
[13:26:35] Me: that would be a 16.6% rise
[13:26:54] Me: that was my conservative estimate. bullish estimate is $50 if they can meet demand with the wii
[13:27:11] Me: which would be 45.8% rise
[13:27:25] Me: so here's hoping
[13:27:59] Him: $40 sounds about right
Session Close (Him): Tue Feb 06 13:32:15 2007

And right now, the stock is very close to my most bullish year end estimate, and at the upper range of the estimates of nearly every analyst. Between the profit taking on the TSE the past couple of days, it being in the upper range of my bullish estimates, and there being no news for the next month or so, I figured now was a good time to sell out of the ADR.


Hopefully it'll drop back to the $43-$44 range and I can buy in again. If not, I still made my target estimates on the stock.

Unfortunately it is unlikely to drop on its own because the Wii's growth has already been factored in to the valuation. This is why Google stock is ridiculously priced because investors expect growth. Also, if it is on the way down (or has tumbled) it seems slightly stupid to rebuy considering this.

Edit: Seeing the post above about growth, hardly any of those methods are "accurate" for technology stocks. Although comparative metrics do, to an extent, help because of lock-in and network externalities involved (which cannot readily be factored in) they are usually crazy.

 

[Natoma]

Unfortunately it is unlikely to drop on its own because the Wii's growth has already been factored in to the valuation. This is why Google stock is ridiculously priced because investors expect growth. Also, if it is on the way down (or has tumbled) it seems slightly stupid to rebuy considering this.

Edit: Seeing the post above about growth, hardly any of those methods are "accurate" for technology stocks. Although comparative metrics do, to an extent, help because of lock-in and network externalities involved (which cannot readily be factored in) they are usually crazy.

Stocks can zoom to a valuation too fast you know. That's what I'm betting on. Nintendo for example shot up to $37 from a $29 valuation in mid January based on the Christmas sales, and then dropped to $32 a couple of weeks later.

In this same frame, we've shot up from $40 to $46 in only 2-3 weeks. I'm banking on a retrench considering there's no news for at least a month. 1Q end for Nintendo is June 30th, so they won't release financials until August most likely. Besides E3, there's nothing else in the pipeline between now and then.

Just a little profit taking.

 

[DudeMiester]

When you buy SNE (ADR) on the NYSE, you are buying 6758 on the TSE.

The value of an ADR is backed by the underlying value of the foreign company's shares on their home exchange.

I suspected something like that, since the graphs of the stock's value for each exchange were nearly identical. Certainly, it is an absurd valuation of Nintendo, despite their success.

 

[Kryton]

Stocks can zoom to a valuation too fast you know. That's what I'm betting on. Nintendo for example shot up to $37 from a $29 valuation in mid January based on the Christmas sales, and then dropped to $32 a couple of weeks later.

In this same frame, we've shot up from $40 to $46 in only 2-3 weeks. I'm banking on a retrench considering there's no news for at least a month. 1Q end for Nintendo is June 30th, so they won't release financials until August most likely. Besides E3, there's nothing else in the pipeline between now and then.

Just a little profit taking.

Yes. You also forgot to mention the stocks can shoot down. Arguably it's safer to bet against the loss than a profit (maximum loss of your investment vs. infinite potential rise), but there is a reason for these dramatic shifts. The markets are pricing in growth, see it realised and take it. They really don't give a shit about the company Nintendo as a whole, just how many units it moves and how much profit/dividend they will recieve.

 

[Philtho]

The bet, I think, is on the Wii becoming more than just a gaming device. One of the main challenges of introducin technology into the livingroom is the control mechanism.

Speaking of, the local news here just had a series on how a rehabilitation section of the local hospital is using Wiis for people to exercise recovering arms. They profiled a local police officer who got hurt (stabbed?) in the arm pretty bad, and hasn't been able to fire a gun since. They have him on the Wii for hours at a time playing what looked like a Duck Hunt clone with a weight around his wrist and he was using the remote as the gun. The doctors said they currently have four people using the Wii, and that its an excellent device for helping these kinds of recovery.

The only problem I saw was that they had it hooked up to a tiny 13" TV.

I thought it was pretty interesting because it came across so honest and was actually being used professionally instead of the usual laughing it off with goofy "lol games i'm too old for this" remarks these pieces usually give off.

 

[Shifty Geezer]

That's a very good idea. Getting peopel to do exercises for the sake of exercises is down0right dull! Exercising isn't a hobby but a chore! If you can turn it intoa game or pasttime, you're ontoa winner in every way.