G-Wii-ner Gaming Part 2



Thursday, July 26th, 2007
Welcome back,
In the previous article I covered how the Wii is a great system for people who like to have fun gaming and also, as a cool side effect, use little electricity. But there is more to the Wii than just a small pretty white case. The Wii is flying off shelves, being bought by everyone from parents for their kids to kids buying them for their parents and grandparents. The Wii is hitting markets that game systems have never even tried to touch. You may still be saying, “Right… your point?” For you I say, there is green to be made!
Nintendo, the company behind the Wii, is not only selling Wii’s like fire to a caveman, but it also has a portable game system called the “Nintendo DS” which is selling even better than the Wii!!!
In the video game business it is not the norm to make money off of the console. The idea is usually to sell as much hardware as you can so that game developers see that you have lots of people to sell games to, so that they want to make games, so that gamers buy more consoles, so that developers want to make games… you get the point. There is one difference for Nintendo though, they like to make money on everything that they sell. Stock holders love companies that make money, especially if they make money on things that are normally loss leaders. Another fun fact is that developers of consoles “License” games to play on their consoles. For every game that anyone sells on a Nintendo console, Nintendo made or not, Nintendo will get a cut of the profit. With the speed the Wii is flying off shelves, game developers who once were devoted only to the PS3 and XBOX 360 are now starting to cancel projects on those consoles to put their effort into creating games for the Wii.
With the expanded market that includes the masses, Nintendo is reaching numbers never thought possible on the back of profits never thought possible this soon after a console launch. Heck Sony is still reported to be losing about $150 – $200 for each PS3 it sells. That is definitely not a good way to make money.
Nintendo’s stock symbol is NTDOY. I have owned this stock since it was $21 per share and now it has climbed over $55 per share without even glancing back. When I purchased the stock Nintendo were being laughed at because their Wii console was not very powerful and was not expected to sell well and the DS had stagnant sales. People said Nintendo was going for niche market and not much else. By the time the stock hit $35 the DS was starting to pickup steam and the Wii launched to a better than anticipated launch, but everyone thought that both the Wii and DS were a fad destined to die soon. Now that Nintendo is raising their profit forecasts by 40% for the quarter many investors are starting to think that Nintendo has some staying power and a solid base for income. NTDOY has gained tremendously as has the Wii consoles demand in everything from nursing homes to fitness centers to your livingroom. Nintendo is becoming a very steady stock and seems to match the growth of Google or Apple. Get in while the getting is good. This is another one of the many ways we think greener.
-LINKS-
Yahoo Finance NTDOY
GamePro Sales Info
Fox News Nursing Homes
TG Daily Wii Fit
You Tube Family Wii Game