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Nintendo shares fall to 5 year low after Wii U reveal

Wed 08 Jun 2011 10:28am GMT / 6:28am EDT / 3:28am PDT
Hardware

Stock declines as analysts are disappointed by E3 conference

Nintendo's share price has hit its lowest value in five years following the unveiling of the Wii U device.

That's according to Bloomberg, which noted a 7.5 per cent drop in the price to 16,610 (around 125). More than 1.67 million shares changed hands yesterday, compared to the daily average of 724,000.

"There were high expectations from the new version of the Wii and this fell far short," said analyst Yusuke Tsunoda.

"People had expected to see something more at a big event like the E3, but there wasn't really anything more than what's already reported."

Nintendo stocks had already taken a blow earlier this year, when concerns over supply of the 3DS and the impact of the Japanese earthquakes made investors cautious, pushing stock to its lowest in two years.

19 Comments

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
#1

Neil Young Programmer, Rebellion Developments

303 383 1.3
One has to wonder what investors were expecting...

Posted:3 years ago

#2

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
Neil, my understanding is that investors were hoping Nintendo would go full on social gaming.

This tells me the social gaming bubble is growing to a dangerous proportions as investors are carelessly throwing money behind something they don't fully understand.

More to the point, Nintendo has never had a red quarter that wasn't based on currency exchange rates in the entire 120+ year history. And that's only happened twice. If anything, they should be the brick you invest in regardless of what they do.

Posted:3 years ago

#3

Neil Young Programmer, Rebellion Developments

303 383 1.3
If they wanted social then they may still be in luck - proper internet support was mentioned and a touchpad with camera will do fine for social stuff...

Posted:3 years ago

#4

Daniel Hughes Studying PhD Literary Modernism, Bangor University

436 496 1.1
Many investors are only interested in their own short term gain. With Wii fading and 3DS not exploding, they may be thinking they should sell high now, to buy lower shares later, and watch their value increase as 3DS takes off and WiiU hits the market.

Posted:3 years ago

#5

Andrew Goodchild Studying development, Train2Game

1,254 421 0.3
Daniel. They were being sold at a 5 year low price. That's not selling high unless you expect the share price to really plummet.

Posted:3 years ago

#6
Well said Jimmy! They remain by far the most innovative of all the big players, the industry goes one way and Nintendo always go the other...

Posted:3 years ago

#7

Nigel Knox Software Engineer, Slant Six Games

11 0 0.0
>> If anything, they should be the brick you invest in regardless of what they do.
Not wanting to pick on you, but this is exactly the sort of thinking that leads to bubbles and crashes. Everything has an absolute value, as well as relative value. Whether a share price goes up or down should depend on where it started from.

I agree with remark about social gaming. A lot of "amateur" investors only got introduced to social gaming with FarmVille and therefore they perceive this to be "new". In fact, MMORGS, friends lists, clans, etc, have been a part of gaming for a long time. The innovation really was casual-social gaming, but casual gaming by definition is not "sticky", and you have to wonder how many people will loose a lot of money when the penny drops, and profits never materialise.

Posted:3 years ago

#8

Chris Paton

6 0 0.0
It's interesting to compare the 'bullying' Nintendo received in the early 90s from Sega to that they received recently from Sony's US top man. Sega went on to make the Saturn, while Nintendo continued their successes with the N64. Whatever people say about the Wii, it's sold 1.5 times more than the next console (PS3 at the mo, I think). I haven't looked at the Wii U yet, but I'm sure Nintendo know what they're doing. If there shares continue to drop, it may be a good time to invest...

Posted:3 years ago

#9

Greg Wilcox Creator, Destroy All Fanboys!

2,193 1,170 0.5
FEH. Screw these anal-yts and investors who don't game and don't see past lining pockets of shareholders, I say. While it IS important to forecast SOME things, you absolutely cannot forecast the fun people will have making games for the unit which will translate into users having more fun in the end, blah, blah...

Anyway, my interest in the new console went up because I started thinking of a few dozen ways I'd love to see it used in games as soon as I saw that controller (and I'm not a game developer).

Edited 1 times. Last edit by Greg Wilcox on 8th June 2011 9:01pm

Posted:3 years ago

#10

Abbass Hussain International Business Development, AQ Interactive

13 0 0.0
I for one am delighted they didn't come out with something completely different. What they've basically done is update the Wii and add an additional interface: it takes nothing away from the Wii concept. I sure hope the Nintendo guys realise that in terms of gaming, they've done the right thing and the feedback from inside the industry is very positive.

Posted:3 years ago

#11

Adam Parker Academic Coordinator, Qantm College

15 0 0.0
Shocking. Industry analysts failing to understand a TV-free 1080p portable deathmatch kit.

Project Cafe - hint, hint? Deathmatch - anytime, anywhere...

Contacting my broker with a clear buy directive... ;^)

Edited 1 times. Last edit by Adam Parker on 9th June 2011 2:52am

Posted:3 years ago

#12

Glen Elliott Partner/Head of Sales, European Game League

57 2 0.0
For those interested, stock is down another 4.5% (16160) today

Posted:3 years ago

#13
I think they may be right. I don't know how investors value the portable gaming market relatively to the home gaming market. But if they value the portable part very high, they're decision is the right one.

The 3DS is not the proper form for modern gaming. Its audience is too limited. Under 6 (IIRC), you need to deactivate the 3D, so the parents can decide to keep the DS instead of buying. Over 10, one prefers an IPhone/IPad/Android (beyond this age, talking to girl/boy-friends via facebook/phone/email is as important as gaming). Some "hardcore mobile gamers" will buy the device but that's not how DS and Wii built their success.

Sony is in a difficult position with the PS3 but they are on the right track about their phone/console combo.

Posted:3 years ago

#14

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
Lionel, the 3DS was not the focus of their E3 presentation so I highly doubt the overnight stock drops are related to the 3DS.

Posted:3 years ago

#15

Andrew Goodchild Studying development, Train2Game

1,254 421 0.3
@Jimmy whilst you are probably right, the lack of focus on 3DS at the conference may have contributed if investers were expecting to be shown how 3DS was going to be boosted. Baring in mind the release of WiiU is nearly a year away, and the normal Wii will be expected to slow, maybe investers needed to see more 3DS, as it is Nintendo's main drive for the rest of the year.

Edited 1 times. Last edit by Andrew Goodchild on 9th June 2011 12:06pm

Posted:3 years ago

#16

Mark Raymond Gamer; Consumer; Blogger

40 0 0.0
If I were investor with a couple of grand going free, I would be buying shares in Nintendo's stock, not selling them. I think they're onto something big with the Wii U and, as such, are seriously undervalued.

Posted:3 years ago

#17

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
@Andrew, then that's their own fault for expecting what is to the the first home console unveiling since 2005 to focus on something else. As I said before, just further proof they don't understand what they are even investing in.

Posted:3 years ago

#18
I was impressed with the Wii U, and the new controller.
Not sure what everyone was really expecting, maybe holographic capabilities?
They upgraded the graphics, the Disc format, and added new features with the controller.
In my opinion the whole Social bubble will burst soon.

Posted:3 years ago

#19

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