After flying as high as the army of Pidgeys you can expect to find upon booting up Pokémon GO, Nintendo’s stock has come plummeting back down to Earth in recent days. Nintendo stock had a huge bump shortly after the release of Pokémon GO, as analysts mistakenly believed that Nintendo was responsible for the latest mobile craze. If any of the analysts had bothered to open the app, they would have realized that Nintendo’s name doesn’t appear anywhere immediately obvious in the game.
Sure, you can tap your Pokéball icon, go to Settings, scroll down a bit and choose “About Pokémon GO.” After scrolling a bit more, you’ll finally see Nintendo listed in very small print along with Creatures Inc. and GAME FREAK, the other two subsidiaries of the Pokémon Company. Nintendo is definitely the most well known of those three, and all previous Pokémon games have been distributed via Nintendo consoles, so to a certain extent I can understand the confusion. If you’ve been following any sort of Pokémon news though, you have probably seen the following informational flow chart detailing the game’s origins.
As you can see in the graph from Bloomberg below, Nintendo stock jumped like crazy shortly after the launch of Pokémon GO. After that brief spike, the stock is currently in a bit of a free fall.
Nintendo, for their part, doesn’t seem to be particularly phased. I’m sure the brief jump in stock price was welcome, though they’ve remained pretty steady with their performance projections for the year. Unlike some analysts, Nintendo understood that their financial impact due to the rampant success of Pokémon GO would be somewhat limited. They’ll see a portion of the crazy amounts of cash that the game has generated, but not the lion’s share that analysts were expecting.
Nintendo does, however, have a higher stake in the creation and sale of the Pokémon GO Plus wristband peripheral, which is expected to go on sale soon. If budding Pokémon trainers take a liking to the wrist-worn Pokémon tracker, that would be a boon for Nintendo. Either way, they have included the potential income expected for the Pokémon GO Plus in their financial numbers for this year, so analysts should maybe read that kind of thing before going too nutty in the future.
Did you buy into the hype on Nintendo Stock? Were you holding Nintendo stock before the jump and did you maybe pick a good time to sell it? Tell us what you think in the comment section below, or on Google+, Facebook, or Twitter.[button link=”http://www.bloomberg.com/news/articles/2016-07-25/nintendo-set-to-plunge-after-saying-pokemon-go-s-impact-limited” icon=”fa-external-link” side=”left” target=”blank” color=”285b5e” textcolor=”ffffff”]Source: Bloomberg[/button][button link=”https://www.nintendo.co.jp/ir/pdf/2016/160722e.pdf” icon=”fa-external-link” side=”left” target=”blank” color=”285b5e” textcolor=”ffffff”]Source: Nintendo[/button]