If you want to know what I think about buying Nintendo’s stock today, check out this article:

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Should You Buy the Nintendo Stock (TYO: 7974) Today?

If you're thinking about investing in the Nintendo stock (TYO: 7974), you may be wondering whether now is a good time to do so. In this short analysis, we'll be taking a quick look at the current state of the Nintendo stock and whether it might be worth considering as an investment option. Please keep in mind that this is not a comprehensive analysis of the company's finances, but rather a brief overview of the stock's potential value at this time. Let's get started…

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12 days ago · 4 likes · Rei

With the new Super Mario Bros. Movie coming to theatres in less than a month (US release date: April 7, 2023), the world of entertainment is about to be rocked by a seismic shift. A new challenger has emerged, and it's poised to dethrone the reigning king and take its place as the ultimate entertainment powerhouse. This challenger is none other than the beloved video game company, Nintendo (TYO 7974).

Disney has long been the dominant force in animated movies, merchandise, and theme parks. But Nintendo, with its vast library of beloved characters and stories, has the potential to create a cinematic universe that will blow Disney out of the water.

From Mario and Zelda to Donkey Kong and Kirby, Nintendo's lineup of iconic characters is sure to capture the hearts of audiences of all ages.

People are tired of Disney content…

Sure, Disney's roster may appear impressive, boasting IPs from their own massive universe, but also from Star Wars, Marvel, and the Pixar universes, but the cracks are beginning to show. Marvel's latest movies and TV shows have underperformed, Pixar's animation has lost its luster, and more and more fans are furious over Disney's relentless pursuit of profit through cash-grab titles from the Star Wars universe.

In contrast, Nintendo has meticulously cared for its IPs, resulting in almost all games from its main franchises receiving overwhelming praise and massive sales. And, unlike Disney, the company has not made a serious attempt to enter Hollywood in over 30 years.

It's safe to say that while fans are starving for more from Nintendo, they are becoming increasingly disillusioned with Disney's endless stream of mediocre and profit-driven content.

Nintendo's IP Monetization Strategy

The potential for Nintendo is staggering, if it's able to capture even a small portion of the market currently dominated by Disney, it could lead to substantial returns for investors. It's a high-risk, high-reward proposition, but one that could pay off big for those who are willing to take the gamble. Nintendo's IP's and its strong fan base, along with its new strategy, could be a powerful combination that could shake up the entertainment industry, and leave Disney scrambling to hold on to its crown.

In recent years, Nintendo has shrewdly expanded its focus on monetizing its IP through various means such as mobile games, theme parks, and merchandise sales.

Now, as the company has made its possibly boldest move yet against Disney by reentering the movie industry, with the release of the animated feature film Super Mario Bros, in a partnership with Illumination (known for movies like Minions and Despicable Me).

This strategy, if executed well, could lead to an explosive revenue growth for Nintendo, as the global entertainment and media industry is a multi-billion dollar market. For example, in 2021 Disney generated around $72 billion revenue from its different business segments and media networks (Nintendo’s annual revenue for the same period was $13.8 billion).

However, it's important to keep in mind that the entertainment and media industry is highly competitive and new entrants are constantly vying for a spot. Hence, there is a lot of risk involved in this kind of venture and investors should be prepared that Disney’s crown might be taken by many of the other strong competitors, including Dreamworks, Netflix or even Apple.

Nintendo needs to “Switch” gears to compete

Today, Nintendo is primarily known as a video game company, with the majority of its revenue coming from the sales of its popular console and handheld devices, as well as the games that are released for those platforms. The company has seen great success in recent years with the launch of the Nintendo Switch, which has been a massive hit with both consumers and investors.

However, as much as games have been a major source of income for Nintendo, the company recognizes that it needs to diversify its revenue streams. By leveraging its strong IPs in movies, theme parks and merchandise, the company aims to increase the revenue from these different business segments.

Currently, games represent the bulk of the company’s revenue. For example, for the fiscal year ending March 2020, Nintendo reported revenue of $5.5 billion, with the majority of that coming from hardware and software sales.

The specific revenue that Nintendo could make by beating Disney, is hard to predict as it would depend on a variety of factors such as the success of the movies and theme-parks they launch, how well they can monetize the merchandise and how much they can grow any potential streaming deals. But it's not hard to imagine that Nintendo's IP segment could increase to the size of its gaming segment, particularly if the company is able to capture a significant portion of the market currently dominated by Disney.

That means we could see Nintendo doubling its current revenue of $13.8 billion to $27 billion!

How Nintendo will Beat Disney

I believe that Nintendo already holds the cards to beat Disney in the entertainment world.

The cards I am talking about are:

1. Strong financial position: Nintendo is in a strong financial position, with significant resources available to invest in its entertainment and media ventures. This could be an important factor in its ability to make strategic acquisitions and partnerships that could help it succeed in the industry quickly.

2. Iconic and beloved franchises: Nintendo has a number of iconic and beloved franchises such as Mario, Zelda, and Pokémon, which have a dedicated fan base and have generated billions of dollars in sales over the years. These franchises have a strong reputation and are well-known among fans around the world.

3. Focus on mobile gaming: Nintendo has been focusing on mobile gaming in recent years, which has been a key driver of the company's revenue growth. The success of games such as Pokemon Go and Mario Kart Tour has proven the company's ability to monetize its IP on mobile platforms.

4. A strong online and streaming presence: Nintendo has been increasing its online presence, which is becoming increasingly important in today's digital world. The company's online platforms, such as the eShop, have been well-received by fans, and it has been actively developing its online presence through partnerships and collaborations. On top of that, there are rumors that Nintendo is looking to partner up with a strong streaming platform outside the Disney sphere to rapidly increase its market share in the media space.

By leveraging its strong IP, creating high-quality and innovative entertainment, building a loyal fan base, and having a strong online and streaming presence, the company could covert its massive gaming fanbase into movies, merch and theme-park fans to generate additional revenue. On top of that, it would unlock Nintendo’s IPs to an entirely new crowd that today is spending their money on mediocre Disney content.

Partnerships & acquisitions are key

Nintendo, with its vast resources and strategic vision, has the potential to make game-changing acquisitions and partnerships that could shake up the industry.

With recent collaborations such as the Super Mario Bros Movie with Illumination and theme-park deals with Universal Studios, it's clear that Nintendo knows how to strike the right partnerships. The company could potentially team up with other media companies that are facing competition from Disney, making it even harder for the media giant to maintain its dominant position.

Furthermore, Nintendo's financial strength allows it to make outright acquisitions of entertainment studios, particularly in its home market of Japan. Studios like Ghibli, known for their iconic and valuable intellectual property, have previously refused offers from foreign companies like Disney, but may be more open to being acquired by a trusted, local company like Nintendo, especially as its founder, the 82-year-old Hayao Miyazaki, is looking to retire. This could prove to be a strategic move for the company, solidifying its place as a major player in the entertainment industry.

Conclusion

There you have it, the stage is set, the pieces are in place, and the battle between Nintendo and Disney is about to begin. With the upcoming release of the Super Mario Bros. Movie, Nintendo has announced its arrival as a serious contender in the world of entertainment. And while Disney may have the advantage of size and scale, Nintendo has something that money can't buy: a dedicated and passionate fan base earned by truly taking care of its amazing IPs.

The potential for Nintendo is staggering, and if the company can execute its plan successfully, it could lead to a seismic shift in the entertainment industry. With its vast library of beloved characters and stories, Nintendo has the potential to create a cinematic universe that will capture the hearts of audiences of all ages.

But it won't be easy. The entertainment and media industry is highly competitive, and new entrants are constantly vying for a spot. And while Nintendo has many cards up its sleeve, there is still a lot of risk involved in this kind of venture.

Only time will tell if Nintendo can dethrone Disney as the king of entertainment. But one thing is for certain: the battle is on, and it's going to be one for the ages. So, grab your popcorn, sit back, and enjoy the show. It's going to be a wild ride!