Rumor has it that on September 13 Nintendo (NTDOY) will announce November 11th as the release date for the Wii U. According to the rumors, various models will be priced at $249.99, $299.99, and $349.99. Not known yet is what consumers will get at each price-level.
Kaptall investors should know better than to trade on rumors, but there is some value in them. The growth of mobile gaming on smartphone has taken a toll on gaming. Video game sales slid again in August, according to research firm NPD Group.
Video game software sales dropped 9% year-over-year to $237.7 million. Total retail sales, which include game software, systems, and accessories, dropped 20% to $516 million. An updated release of a Nintendo console would be the first step in reversing the decline. More importantly, consumers need to wean off smartphone games for console gaming to take off again. New consoles for Microsoft’s (MSFT) X-Box, rumored for fall 2013, and Sony’s (SNE) Play Station would also help the gaming industry.
Investors wanting to get ahead of the curve should add these game companies to their watch list:
In the Multimedia & Graphics Software sector:
1. Activision Blizzard, Inc. (ATVI, Earnings, Analysts, Financials): Publishes online, personal computer (PC), console, handheld, and mobile games of interactive entertainment worldwide. Market cap at $13.36B, most recent closing price at $11.98.
2. Electronic Arts Inc. (EA, Earnings, Analysts, Financials): Develops, markets, publishes, and distributes game software and content for video game consoles, personal computers, mobile phones, tablets and electronic readers, hand held game players, and the Internet. Market cap at $4.47B, most recent closing price at $13.82.
3. Take-Two Interactive Software Inc. (TTWO, Earnings, Analysts, Financials): Develops, and distributes interactive entertainment software, hardware, and accessories worldwide. Market cap at $950.29M, most recent closing price at $10.46.
4. Microsoft Corporation (MSFT, Earnings, Analysts, Financials): Develops, licenses, and supports a range of software products and services for various computing devices worldwide. Market cap at $259.47B, most recent closing price at $30.62.
5. THQ Inc. (THQI, Earnings, Analysts, Financials): A worldwide developer and publisher of interactive entertainment software for all game systems, including home video game consoles, such as the Microsoft Xbox 360 (Xbox 360), Nintendo Wii (Wii), Sony PlayStation 3 (PS3) and Sony PlayStation 2 (PS2). Market cap at $29.4 million. Most recent open price at $4.28.
In the hardware space:
6. Sony Corporation (SNE, Earnings, Analysts, Financials): Designs, develops, manufactures, and sells electronic equipment, instruments, and devices for consumer, professional, and industrial markets worldwide. Market cap at $11.69B, most recent closing price at $11.82.
7. Nintendo Co., Ltd (NTDOY, Earnings, Analysts, Financials): Mainly engaged in the development, manufacture and sale of entertainment products in home entertainment field. Market cap at $15.65 billion. most recent open price at $13.92.
To get a snapshot for each company, click on the company icon. To get more detailed fundamental information on any of the companies, open the snapshot and select “number cruncher.”
Disclosure: Author has a long position on Electronic Arts.
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This is why financial companies should stay away from video-game industry analysis. Nintendo's share prices and the decline in year-over-year sales mean nothing as:
a) Nintendo's real value is less reflected by its share price, and more by how it innovates the industry through new video-game concepts and control methods.
b) Year-over-year sales are bound to decline at the end of a console cycle, especially since this has been the longest console cycle in gaming history.
Nintendo is positioned for Strong Buy. Hold on Microsoft and hold or moderate sell for Sony.
You supposed analysts have been told many times by many people, maybe analysts are too good to read readers' responses.
A mobile casual game is no substitute for a non-casual console games. Mobile games are not to blame for declining sales, console cycling is. The only people who seriously aren't interested in console games anymore are the especially casual gamers who weren't and still aren;t true gamers anyway…they were a flash in the pan boom when Wii came out and it'll be a whole other generation (of people) before that can be milked again.
Wii U will go on sale Dec 8 in Japan ($405 US) http://www.theverge.com/2012/9/13/3325246/wii-u-j…