Nintendo adds another US$3bil in market value

Strong counter: People visit a Nintendo store in Tokyo. Nintendo has been one of the strongest-performing blue-chip stocks in Japan this year. — Bloomberg

TOKYO: Nintendo Co added another US$3bil in market value in Tokyo with retail investors on the Robinhood app cited as helping to further boost the game maker’s popularity.

Nintendo has been one the strongest-performing blue-chip stocks in Japan this year, as the pandemic, together with the release of its smash-hit Animal Crossing: New Horizons game, helped boost the already high popularity of its Switch console.

Shares are up more than 70% from their March low, and have hardly looked back since passing the 50,000 yen barrier in June, with earnings earlier this month blowing past all estimates and Nintendo software continuing to dominate sales rankings in Japan.

The stock added another 4.8% yesterday, the biggest gain since March 19, with Daiwa Securities Co’s Eiji Kinouchi citing the impact of the stock’s popularity with US retail investors.

“As well as Nintendo, Robinhood users like Sony Corp and SoftBank Group Corp among Japanese shares, but both of those have connections to China, ” Kinouchi said in an interview.

“Nintendo is one of the easiest Japanese stock for Robinhood investors to buy into amid concerns over US-China tensions.”

In an Aug 5 report, using data from the now-discontinued Robintrack site, Kinouchi showed Nintendo was the second-most held Japanese stock among Robinhood users, after Sony and ahead of SoftBank.

Investors and gamers alike are still waiting for Nintendo to reveal its slate of games for the rest of the year, with only Pikmin 3 Deluxe, a remake of a seven-year-old Wii U title, set for release in 2020.

David Gibson, chief investment adviser at Astris Advisory Japan, said in a tweet last week that he hoped the company would hold one of its “Nintendo Direct” online presentations to announce new titles before a management briefing scheduled for Sept 16.

The curiously bare game pipeline comes even as Sony and Microsoft prepare to spend big on their new generations of PlayStation and Xbox consoles being released this holiday season.

But for Ace Research Institute analyst Hideki Yasuda, who raised his price target for Nintendo by 6.6% to 67,400 yen, the impact of the rival releases on the popularity of the Switch will be limited.

“Even with the launch of the PlayStation 5 and the Xbox Series X, sales of Switch will remain strong, ” he wrote in a report published Aug 21. — Bloomberg

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