The Nintendo Switch is Slowing Down, No Growth in Hardware sales Expected for Nintendo

It seems like the Nintendo Switch has Passed the Release Hype

One of Nintendo’s biggest supporters on Wall Street Jefferies’ Atul Goyal has reduced his price target for Nintendo by more than %10. It seems like Nintendo’s release hype is finally ending and the Nintendo Switch sales are slowing down, and according to the Nintendo analyst, no growth in hardware sales are expected for Nintendo.

Goyal and his colleague Chengyao Zhang said that even though they remain bullish on the massive gaming company Nintendo, the sales of the Nintendo Switch are likely going to slow down in 2018. According to the Nintendo analyst, the Switch will sell less than previously thought. This is likely due to the fact that Nintendo hasn’t announced that many big titles for 2018.

Goyal wrote, “Market expectations for Switch, as reflected in stock price, have turned from robust growth to no-growth in a matter of three months.” he continued by saying that, “We believe continued sales of Switch over the course of this year and next could very well prove this current thesis of Switch being ex- growth wrong as well.” Previously Goyal held a target of  71,200 yen ($640.45) later reducing his target stock price to 64,200 yen ($577.48). Right now, Nintendo’s stock price is at 36,990 Yen which is a very big improvement for Nintendo.

Eventhough Goyal says that Nintendo isn’t going to do as well as first estimated, Goyal still believes Nintendo’s stock is still a buy. Goyal said, “No other company in our coverage is experiencing such growth and trading at such low multiples.” 

Nintendo’s stock went downhill since the Wii started getting older and the Wii U didn’t improve the rates. The Wii U only made it worse for Nintendo but the Nintendo Switch somewhat revived Nintendo’s stock prices. The Nintendo Switch was a big hit selling millions of units in its first few months. Most of the success came from games such as Super Mario Odyssey and Legend of Zelda Breath of the Wild. The Nintendo Switch was also the first Nintendo consoles in a few years that featured triple-A titles from more than two companies. 

Tags and Keywords:
Technology, Video Games, Nintendo, Nintendo Switch, Nintendo Switch Sales Declining

Ali F
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