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savisn on 17 January 2014
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Figgycal said:
Mr Khan said:
Figgycal said:
Ocilayton said:
Man I wish I could by shares. I would buy every singleone I can now

You'd be holding on to the stock for a long time.

Not really. Some of our more stock-savvy posters have pointed out that Nintendo is actually criminally undervalued right now, that their current market cap is only about 20% more than the value of Nintendo's cash-on-hand, meaning that the stock price does not at all reflect the value of Nintendo's capital or (the far more important one) intellectual property.

If it was announced tomorrow that Nintendo was going to be auctioned off piece by piece, the stock value would double overnight because the market cap is not reflective of the company's actual value, and in the case of total dissolution of the company, it would be.

I didn't say that in my comment at all. My comment was only about stocks-- not Nintendo as a whole, but I also don't think 2014 will be a bright year for Nintendo. This is their third year in a row losing money and the only things to have affected Nintendo's stock prices in the past year were a cheaper Yen and the news of China lifting the console ban. Buy the stock at 15.24 (at the time his comment was posted) and hoping stock prices go back up to 17.50 sometime in the next year isn't a great investment. I'm only an economy student - so IDK. I'd like to hear what the stock-savvy posters think.


2013 wasn't a bright year for Nintendo and I made 60% return in one year, which is great by any measure.  If you believe in a company's long-term value either as an operating company or in some other form (think what it would be worth to either Sony or MS to own Nintendo IP exclusivly) then buying at the lowest point when it looks dire can be a great risk.  The key is to understand the real value, and the risk of bankruptcy.   Cash plus IP make Nintendo a pretty attractive turn-around overall.

That said I do think it could and probably will go lower.  I'll probably get back in between $12 and $14 as I view $12 as a rough floor that it must rise above just based on their cash provided they aren't squandering it.  Sure it can temporarily dip lower as it has this year, but it's fairly low risk in my opinion.   If Nintendo was highly levered (lots of debt) it would be a different story as debt coventant misses can trigger bankruptcy even in healthy companies.

Nintendo is an interesting play - it's not followed closely by large investment houses.  FUD factor is massive - just check out some of the things that get published on Motely Fool and Forbes just today.  They are so far off the real story sometimes that it's pretty easy to stay ahead of them just by following this site - which is why I'm here.   VGC numbers aren't perfect but they give a good indicator overall.