Mark Androvich
23:57 (BST)
22/01/2008
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Analyst expects Nintendo, Ubisoft revenue growth
Expects companies to report upside of estimates
Ahead of financial reports from Nintendo and Ubisoft, Wedbush Morgan Securities analyst Michael Pachter is anticipating revenue growth for both companies.
Ubisoft will report Q3 2008 earnings - for the period ending December 31 - on January 23.
Pachter expects the company to report revenue in line with his estimate and guidance for 410 million Euro (USD 600 million), noting that Ubisoft raised its guidance in mid-December following stronger than expected sales of Assassin's Creed.
He expects Ubisoft's management to maintain current FY 08 and FY 09 guidance for revenue of 840 million euro (USD 1.23 billion) and 975 million euro (USD 1.43 billion), respectively.
"We continue to expect strong sales of next-gen hardware to provide a near term catalyst for Ubisoft share price appreciation," Pachter said in a research note for investors.
Strong DS sales and the company's decision to move several key games into FY 09 will position Ubisoft to deliver upside to its revenue and earnings guidance.
On January 24, Nintendo will also report Q3 2008 earnings for the period ending December 31.
Pacheter expects the company to report upside of his estimates for revenue of 565 billion Yen (USD 5.27 billion) and earnings per share of 773 Yen (USD 7.22), thanks to continued demand for the Wii and DS.
Nintendo did not provide Q3 guidance.
"Nintendo's recent financial performance has been spectacular and we continue to believe its fiscal year 2008 guidance is conservative," he wrote.
He expects the company to raise its current FY 08 guidance of 1,550 billion Yen (USD 14.46 billion) in revenue, operting income of 420 billion Yen (USD 3.92 billion), net income of 275 billion Yen (USD 2.57 billion) and earnings per share of 2,150 Yen (USD 20.06).
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