Share values are vulnerable, to varying degrees, to wider issues and implications of major economies and markets. Those following such things will know that stock markets have experienced a lot of recent turbulence, though recently we shared the re-assuring news that Nintendo's share value rebounded - to an above average level - in Japan.
Since that point there have been drops, but the most recent day of trading in Japan - at the time of writing - saw the country's overall market value increase once again, if only by 0.2%, after three solid days of decline. Nintendo was the biggest contributor to the overall increase, seeing its share value go up by over 9% to 15,990 Yen at closing; a climb of that percentage in a single day is a significant jump. Bloomberg reports that investment group Macquarie raised its rating on Nintendo, with Barron's Asia linking some of that renewed confidence to recent confirmation that Miitomo is on schedule for its March release; DeNA stock also rose over 3%.
You can see the spike in value below.
It's pleasing to see that Nintendo's share (and therefore company) value is not only holding firm with the market, but in cases like today actually improving a long way above the average. With the likes of the NX announcement, Pokémon Go and more DeNA apps on the way there's plenty for investors to consider as positives for 2016.
[source bloomberg.com]
Comments 22
Always nice to read even some positivity.
Good spike. Hope it continues to climb for what's in store for this year.
That's why stock market is so ridiculous - it's based on people's emotions. One day the investors might hear some rumour that makes them fear their investment was for nothing, so they sell it. The other day they hear something that sound's positive so their mind goes BING BING BING, I gotta buy those shares quickly!
That's the investors sorted. ..... now what about the gamers
Still find it hard to believe that investors are excited over free-to-start Miitomo, but maybe just the fact that it's finally coming out as the first of many mobile games that has investors excited for 2016? Or NX? Or Pokemon taking over the world this year. Seriously how much Poke' stuff can release in 1 year? TV show, movie, cards, new games and old games on mobile, 3DS, even a Wii U game. Link and Zelda have a 10 year old remaster for their anniversary, until they say more about Zelda U that's all they get.
A spike is a spike and should be treated as such and is by no means a representative of the actual value of the stock. Point is, Nintendo stocks will be going up the end of this year , but this is not that, this is the Japanese stock market bouncing back.
It's mainly due to investors coming to terms over the CHINESE SLOW DOWN! Asian markets are briefly recovering at the moment. It's very likely this week could see another massive sell off globally as the markets remain unstable over China and the fears of a global recession.
@Dakt If Nintendo's stock reaches 0, they likely go bankrupt. So when it goes up, it means they have more money to make future games. That's about as English as I can put it.
@XCWarrior
That's not true.
Companies only get money from the stock they sell to the market.
When a shareholder or investor sells a stock, the money goes to them with the company never seeing a cent.
Market capitalization only impacts the on paper value of the company and it's ability to borrow large sums of money.
If Nintendo stock dropped to 1¥, Nintendo would easily take itself private for dirt cheap.
The company financial rating determines how cheaply they can borrow on the credit markets.
The financial ratings also determine how credit worthy the company is based on financial data and it's payment history.
This is the company and country version of a credit rating.
AAA is the highest.
Nintendo has a high rating and no debit of any sort.
They have billions in assets and cash.
They use their profits to fund the company instead of borrowing or issuing new stock.
Nintendo has been buying back shares for 20 years now, leaving the company with 9% of the total stock.
Sony on the other hand has billions in debt and low credit rating.
Sony has been borrowing billions to keep the company operational at high interest rates due to the company being unprofitable for over 10 years now.
Sony is dependent on the whims of the stock and credit markets for their survival, while Nintendo and Microsoft aren't.
@Xenocity But their PS4 system is selling like hotcakes... It's nuts!
Probably going higher because people are expecting good financial numbers for the 3rd quarter. Depending on what is reveled it will either drop or remain steady but expect a lot of movement over the next two weeks......so in short this doesn't really mean anything.
@MrPuzzlez That is part of the solution, but represents the problem Sony had, it does an utter crap ton of other things that have been hemoraging money for years. That's why these past few years Sony has been cutting divisions and teams in an effort to focus on fewer things but be more competitive.
@MrPuzzlez
PS4 doesn't have big profit margins and their other divisions are running deep in the red.
Wow... With Sony, their stuff's GREAT, but the cost of maintaining is staggering. Meanwhile, with Nintendo, their stuff's decent, but at least it's not running in the red. My question is, what would happen if $ony gets TOO far in the red...?
@MrPuzzlez
Sony doesn't make great stuff at all.
You can easily and normally find a better product at a cheaper price that put the Sony product to shame.
This is why Sony has been losing sales in every market that isn't gaming.
Sony literally bleeds money on every product they sell that isn't life insurance and PS4 (small profit margins post price cut).
Sony is already in the process of laying off more people, restructuring the company, selling off assets and selling/spinning off divisions to avoid bankruptcy.
The PS3/Bluray combination was the final straw for Sony.
Sony might be able to avoid bankruptcy, but it is still a long shot even today.
guess they hear about the upcoming direct rumors as well.
@Xenocity i would add that sony cmos sensors also dominate the digital photography market. but other than that, yeah, they've been in doodoo for a while now and only turned it around this year. maybe that's why they have such huge discounts and sale events on psn. they need it that much more. having said that, week one of the winter warm-up sale was the very first time i ever bought more games from the eshop than psn for the same amount of money.
Nintendo is in a little different position than Sony. Nintendo has a lot of cash and convertibles (not the car😀) available. They have no debt really to speak of.
As much as we want the NX to be the next big thing, it will have a bearing on the companies performance, but not as much as the exchange rate has a beating. The latest profit that Nintendo turned was due in large part to favorable exchange rates on the cash they have available.
Finally! Some good news for good ole Nintendo!
People always whine about these types of articles on NLife, but as an investor in the company I appreciate that you keep me updated! I was actually just telling my financial adviser about a week and a half ago that I thought Nintendo was going to bounce back. She humors me on this because Nintendo is my pet stock and literally none of her other clients (who are mostly older than me) invest in it. But it's fun to be right and not just a fangirl.
@Xenocity We weren't talking about Sony. I know they are in trouble. Companies want their stock to go higher. They don't want it to go down. I know Nintendo has money in the coffers if their stock tank, but it would hurt the company a lot, especially after they had to buy back shares from the Yamato (SP?) family after that one person's death.
Stocks are not the be all end all, and yes Nintendo and MS are doing better than Sony, but not like Sony is going to go anywhere. With how PS4 is doing, Sony could just eliminate phones or TVs or something, wherever they are losing the most money, and eventually get out of the debt they are swimming in.
But trying to keep it simple. Stocks up = Good!. Stocks down = Bad!
@XCWarrior
Nintendo's owned stock doesn't count towards market capitalization.
Market capitalization only takes into account stocks available on the market.
High stock price is not always a good thing, it really depends on what the companies plans to do long term.
Company like Nintendo, who is constantly buying back shares probably takes advantage of stock drops to rebuy more shares.
Stocks up = Good!. Stocks down = Bad! is not a golden rule nor is it something most companies seek.
Stable reasonable price is good.
Here's an overview of Sony:
1) Sony has over $60B American in debt (most is short term).
2) Sony share price hasn't recovered and is down almost 8% todayhttps://www.google.com/finance?q=TYO%3A6758&ei=7qqfVrmTK4y5mAGavLG4Bw
3) Sony's share price is roughly $24 USD and that is really down from the early 2000s high.
4) Sony has 26 divisions (They spun of their PC division and retained a small stake in it)
5) Only 2 of the 26 divisions are profitable on a yearly basis.
6) The only two profitable divisions are the Insurance division (Japan only) and Playstation division (marginally profitable)
7) The rest of the divisions bleed hundreds of million of U.S. dollars to billions of U.S. dollars.
8) The TV division alone costs them billions each year in the red (core Sony division), the phone division runs hundreds of millions in the red, despite selling tons of camera parts to Apple and others. No one is buying Sony's TVs and other phone stuff.
9) Even Sony's movie and music divisions are running in the red significantly as well (They used to be very profitable)
10) Sony is literally only staying afloat by selling prime real estate (they own a lot of valuable real estate) and borrowing from the markets at double digit interest rates.
If Sony shed every unprofitable division, it would literally become a an insurance and real estate company that sells video games products on the side.
But Sony's management is hell bent on keeping the company as a multimedia electronics company at all costs.
That or at least until they run out of real estate and/or the Japanese government intervenes, leading to an unwinding(peaceful break up) of the company.
Sony is still bleeding money, but the last FY they only bleed hundreds of millions of U.S. dollars, down from the billions of losses in the previous decade (2006-2015).
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