Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), has acquired a 5% stake in Japan-based video game company Nintendo Co. (NTDOY) worth around $3 billion, a report published by The Wall Street Journal said.
In a Japanese regulatory filing, PIF said that the stake purchase was only for investment, and it did not plan to influence Nintendo’s strategy.
On May 10, the company announced better-than-expected results for the fiscal fourth quarter ended March 31, 2021. Earnings came in at $0.90 per share, beating the Street’s estimate of $0.68 per share. However, the figure was down almost 10% year-over-year.
About Nintendo
Kyoto-based Nintendo is engaged in the development, production, and sale of home entertainment products. Its entertainment products include portable and console game machines and software, trump card and Karuta (Japanese-style playing cards), consumer electronics, home console hardware such as Nintendo Wii, Nintendo DS, Nintendo 3DS, and software for handheld and home console gaming machines.
Price Target
Based on a single Buy, the stock has a Moderate Buy consensus rating. NTDOY’s average price target of $72.67 implies 27.7% upside potential from current levels. Shares have lost over 20% over the past year.
Website Traffic
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, offers insight into Nintendo’s performance.
According to the tool, Nintendo’s website traffic registered a 13% fall in global visits in April, compared to March. However, the footfall on the company’s website has grown 13.5% year-to-date against the same period last year.
Conclusion
Following the news on Wednesday, NTDOY stock rose 2.5% to close at $56.92. In the first couple of waves of the COVID-19 pandemic, the company’s revenues grew significantly as people bought video games. However, as the pandemic stretched, supply chain issues started to hurt the company.
Learn more about the Website Traffic tool in this video by Youtube sensation Tom Nash.
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