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OceanJ on 04 January 2013
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Tarumon said:
outlawauron said:
Tarumon said:
outlawauron said:
OceanJ said:
outlawauron said:
Vinniegambini said:

current exchange rates are favourable.

As someone who imports a good bit, the exchange rates are still horrible. Nintendo and Sony will continue to lose millions because of it.

Huh?  The weaker the Yen, the more profits Sony / Nintendo make overseas...which is the bulk of their sales.

That means they make more money.

But the yen isn't weak. It's still very strong and far too strong for their overseas business. 87 yen to 1 dollar is better than the 75-80~ it's been floating around for a year or two, but it was 130 yen to 1 dollar at the start of the generation.


Based on the amount in foreign currency translation loss, Nintendo's looking at most 106 Yen to Dollar to have fully recovered.  Euro has been the more painful due to their PIGS crisis.  Nintendo definitely doesn't need Yen back at 130, at 90 or above, most exporters, especially Nintendo will be in good shape.  Also remember, due to the nature of those paper losses, every year Nintendo's been stashing dollars and euros even over the last few years.  Nintendo had accounting losses when stated in Yen terms, but Nintendo of America was collecting more dollars every year.

But it's still below 90....

Below 90 hurtssome exporters.  Nintendo is not one of them.  They were able to generate profits from unit sales even at 77.  It's 88 and trending up, so for Nintendo at least, the built in windfall is already quite substantial.  Nintendo has two components: Gaming business and a disporportionately large stash of cash parked in Dollars and Euros.  90 or above will fatten up the margins for Nintendo, but just the fact that the USDYen has been climbing from the abyss of just 3 months ago will do wonders.

To put Nintendo's unique situation inperspective.  Nintendo generates about 60% of sales from Dollarss and Euros.  Company wide sales as of 9/30/12  201 billion yen......Company Cash 478 billion.  See that?  Even @ best of times margin of 50%, or now 20%, the gross margin of 60 billion or 24 billion multiplied by % change in YenFX is dwarfed by the sheer size of the Cash on hand.  Each yen to dollar or euro decline is a straight are free coin drops into Nintendo's coffer.  That's why I keep stressing, Nintendo is as solid a company as it gets and stands to profit from the triforce of 1. 3DS in money printing mode 2. Yen translation gains and 3. Wii and DS residual profits (high margins, low cost). Three profit pillars to prop up a 75% of Wii Sales Wii U?  

If you think Nintendo's marketing machine is being frugally run, their Investors relation even worse so.  Never see Nintendo trumpet themselves....but I guess when you don't need to borrow, have zero anticipation to raise more money from investors, you can afford to just act like you are really a private company minding your own business.

Nintendo's Zero-Debt gives them full autonomy.  But I agree their investor relations is maddening.

Is there any way to tell if Insider Buying is happening at Nintendo?