| JRPGfan said: Nintendo stock is overvalued ? In 2016 wasnt there a thread about how Sony had made more money from "ps plus" than the entirety of Nintendo did that year?
http://www.eurogamer.net/articles/2016-04-28-sonys-psn-is-making-more-money-than-all-of-nintendo
"During the financial year ending 31st March 2016, Sony's PlayStation Network generated 529.1bn yen in sales. During the same financial year, the whole of Nintendo pulled in 504.4bn yen in sales. In terms of operating income, or profit, PlayStation made 88.7bn yen (£538m). Nintendo made 32.8bn yen (£207m)."
If sony makes much more revnue & profit than nintendo, why is nintendo stock almost as high? Stock markets dont make sense to me at all. |
Stock represents the valuation that the market predicts for a company. If they see a healthy future, stock increases due to more buyers. If they see any bump on the road, the value decreases due to how this impacts the previews.
So it's not exactly directly related to revenue/profit, even if these factors have a big impact. If, let's say, Apple somehow faild to hit their profit forecasts by 10% on a quarter, their stock would take a sizeable hit, because those are bad news. It doesn't matter that even by missing it by 10% that profit was actually way higher than all other companies in the world.
Currently Online 
