As a general rule, most investors make very bad decisions ... It isn't that unusual to watch investors sell their stock which has already been over-sold to buy into a stock that is over-bought; and I think this has been impacting Nintendo's stock for quite some time.

When Nintendo surprised people and had a break out success with both the Wii and DS people rushed to buy Nintendo and the stock price was soon worth far more than was justified; and now that Nintendo's share price has fallen, people are selling driving the price far below what is justified.

I called $23.50 two months ago, we're almost there I think its a buy yep.

that said I don't have any money invested in the digital/paper markets as I have zero faith in the global economy or the american dollar but thats another story all together...

3DS is a bomb so far. Remember, Nintendo intended to ship 4 million units by the end of March. The amount they are shipping is an indication of where they believe demand to be. Well it's almost the end of June, and 3DS just hit 3 million in sell through. It will hit 4 million sold through about 5 months after Nintendo thought it would. DS was sold on 2D platformers, top down RPGs, and "non-games," none of which are on 3DS' list of potential saviors for 2011.

The only good interval to fire the president of a videogame company is in the middle of a generation, so that the next generation can take a new direction. So if Iwata is going to be held responsible for the 3DS and Wii U failure, he would be canned in 2013. I wouldn't expect Nintendo stock to do much until we know if Iwata is going to be brought back for a third term, so to speak.

If I owned Nintendo stock, I would be kicking myself for not dumping it last year.

The current P/E is around 24 I would hardly think that it qualifies as being under priced....

Especially as the average P/E for S&P 500 members for example is 14...( I know Nintendo isn't a S&P member).

The growth prospect for Nintendo over the next few years aren't that great either compared to most S&P companies...

Right. Them hitting #2 in Japanese market capitalization had to be based on something, given that they were surpassing companies far larger and in far more vital industries

It couldn't last

For the past 20 years, the average P/E for the S&P 500 has been closer to 25; and the relative growth prospects for Nintendo are better than average.

Right. Because I don't know much about Stocks an the market and whatever...

Can someone explain the significance of this to me, please?

Is it just people losing faith in Nintendo, or does it affect the company in a large way?

Investors =/= people, and are very flighty, and react to a whole host of factors outside of company performance. It *can* reflect a lack of faith in their sales potential, but not necessarily

They became the #2 largest Japanese company because it was believed they would continue to make the same types of products.

If you invested in a company because their hit FPS was going to sell 20 million copies, would you be pretty pissed off if 4 years later, the only follow up to the game was a single map pack? That's how people feel who invested in Nintendo because of Wii Fit, which has had no follow up except Wii Fit Plus after 4 years. Go down the line... Brain Age, NSMB, Wii Sports... When it looked like these games were the future, the stock price soared. When it became clear that Nintendo doesn't care about these games, the price plummeted.

This is not LOL INVESTORS ARE DUMB.