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Forums - Nintendo Discussion - Nintendo Shares Level Out After $4 Billion Drop in Company Value

the delay in itself is not the reason for the drop in the stock, not for the most part. Don't tell me stocks are not based on a long term outlook when amazon is trading at 906 p/e while walmart is 12 p/e. You think investors want their money now? Then why do they allow amazon to make almost no profit for decades? The market will sell off based on comments by the fed that are purely speculation of interest rate increases that might happen sometime in the future maybe and will increase very gradually for years before they reach any significant level. The market prices in the endgame far before you get there.
What the delay did was hurt the confidence in Nintendo, and i suspect they were expecting more of miitomo. That game is way too Japan oriented for investors to get too excited about.



currently playing: Skyward Sword, Mario Sunshine, Xenoblade Chronicles X

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What the drop has done is give a glorious opportunity to add more to my long position.  I will be adding another 1500 tomorrow morning.



Wyrdness said:
VitroBahllee said:


Yeah, but the article also makes it clear investors were underwhelmed with the lame looking 'game,' which you've been arguing against in other threads.


Nope in the other thread this is flat out what I've told you, profits were speculated to be on the way due to an entry in mobile which has now been delayed. As he pointed out the value of stocks depends on expected profits so a delay in these profits means the price would drop meaning a number of current holders weren'te going to make their speculated return. The smart move is to sell while the stock is still overweight before the market corrects itself to reflect the speculated profit not turning up, that way you make money because as he pointed out stocks are short term (in other words they fluctuate like I told you).

You argued in the other thread about the quality of the app as a game which investors don't care about, they care about making money and were hoping for a microtransaction fest. In the other thread I said the stock was going to even out as well something you argued against, take notes from that guy quoted he has an idea of how stocks operate.

It's a knee jerk reaction by some investors.  It has created a nice opportunity to get into the stock at a lower price. The overall value dropped by something like 4.5 billion dollars on the delay of a mobile game.  Last time i checked most mobile games don't generate 4.5 billion dollars so it's clearly an over reaction.  I believe the stock will see at least 10% increase from now until the end of the year.



Dunban67 said:

The "market" does care about the game because if it does not have confidence in the produc/game that is just as bad or worse than a delay- If the product the investors were counting on does not sell like the had hoped that not only delays profits and/or revenue growth it can cause losses (or less profits) 

So to say investos don t care about the game is wrong-  of course the care-

Additonally i have not seen any article or quote from stock analyst, investors ect that said they expcted Mario and micro transactions


No they don't care about the game they never did, all that matters is the money it pulls in investors don't invest based on emotion they look at fundamentals like I explained to you, quality doesn't bring in the most money the products structure does and things like Mario with microtransactions is what investors were hoping for. This is why when Nintendo announced that Mario variant of the Puzzles and Dragons game and people thought it was a mobile title the stock exploded.

What they want is big IPs with microtransactions.



Wyrdness said:
Dunban67 said:

The "market" does care about the game because if it does not have confidence in the produc/game that is just as bad or worse than a delay- If the product the investors were counting on does not sell like the had hoped that not only delays profits and/or revenue growth it can cause losses (or less profits) 

So to say investos don t care about the game is wrong-  of course the care-

Additonally i have not seen any article or quote from stock analyst, investors ect that said they expcted Mario and micro transactions


No they don't care about the game they never did, all that matters is the money it pulls in investors don't invest based on emotion they look at fundamentals like I explained to you, quality doesn't bring in the most money the products structure does and things like Mario with microtransactions is what investors were hoping for. This is why when Nintendo announced that Mario variant of the Puzzles and Dragons game and people thought it was a mobile title the stock exploded.

What they want is big IPs with microtransactions.

I did not think i would need to spell it out any more clearly but the marketability/sales ability of the game equals potential revenue/potential profits

Thwe market trades on a forward basis of what it thinks can/may happen in the future and when it may happen-  a key product the market hopes will bring in revenue growth and or profits in the future that is disapointing to the maret causes a drop as much as a delay perhaps more-  

The delay and the sales/marketablity (real or percieved) and the earnings miss combined hurt the confidence of investors -   

PS:  When I say investors "care" about the game it is in terms of thier confidence in it not weather or not they may like to play it themselves-   They "care" very much just not in the same manner a gamer or Nintendo fan may "care"



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Dunban67 said:

I did not think i would need to spell it out any more clearly but the marketability/sales ability of the game equals potential revenue/potential profits

Thwe market trades on a forward basis of what it thinks can/may happen in the future and when it may happen-  a key product the market hopes will bring in revenue growth and or profits in the future that is disapointing to the maret causes a drop as much as a delay perhaps more-  

The delay and the sales/marketablity (real or percieved) and the earnings miss combined hurt the confidence of investors -   

PS:  When I say investors "care" about the game it is in terms of thier confidence in it not weather or not they may like to play it themselves-   They "care" very much just not in the same manner a gamer or Nintendo fan may "care"

That makes more sense but the nature of the app is more of a factor then what you say because it's free for a start, investors were hoping for a big IP to be sold to consumers for more immediate returns. Miitomo is more to bring people on board to the new account system and acts as a hub for apps and games, it connecting to consumers won't be an issue it just so far hasn't shown how it'll bring in profits and that's what has investors backing off for now.

The sales ability is not the issue it's that it's not what investors were initially hoping for to begin with, it's nature and delay means expected profit won't come as soon as expecting because the app is a long term plan to build a dedicated number of users as opposed to selling minigames and microtrasactions for immediate returns.



Stocks are not silly and they are long therm oriented. They expected Nintendo to move to mobile with AAA games and valued the future expected revenue in the stock price. Since Nintendo does not seem to take the mobile business seriously enough, the expected future revenue is much lower and therefore the stock price falls.



Gotta love that ridiculous sky-is-falling mentality of the market.



Wyrdness said:

What they want is big IPs with microtransactions.


Wow, almost like you are acknowledging they are disappointed in Miitomo at last?

 

etking said:
Stocks are not silly and they are long therm oriented. They expected Nintendo to move to mobile with AAA games and valued the future expected revenue in the stock price. Since Nintendo does not seem to take the mobile business seriously enough, the expected future revenue is much lower and therefore the stock price falls.

 

THIS. This isn't what they thought they were getting. As a Nintendo fan, it's not what I thought I was getting. And if you are telling yourself your honest reaction was 'AWESOME! I'll finally be able to learn more about the people around me, with a Nintendo flair that only Miis can provide! This is better than Zelda/Mario/Wii Sports/Splatoon/Metroid,' then you are lying to yourself and to us.



There are two possible conclusions to take from this; either the stock market is bribed by the competition and/or unfair, illogical and useless, or; the announcement was a negative double whammy in being both about a delay of a much, much needed investment boost in a new and more easily profitable sector of gaming paired with the software itself being generally underwhelming.

Personally, since I never bought the famed Nintendo conspiracy that many seem to cling to since we wielded bow and arrow and wore pelts on our backs during winter, I choose to believe the latter and chalk this down to pure market logic and response, just like every other downturn since the announcement and release of the Wii U and the decline in dedicated handhelds set in.