This week’s launch of Super Mario Run should power up shares of Nintendo, 7974.TO -2.786675208199872% Nintendo Co. Ltd. ADR U.S.: OTC USD30.35 -0.87 -2.786675208199872% /Date(1481757601000-0600)/ Volume (Delayed 15m) : 1026072 P/E Ratio 69.83433041877589 Market Cap 34748994841.3984 Dividend Yield N/A Rev. per Employee 753082 More quote details and news » which still offer value as the Japanese game maker looks to replicate the massive success of Pokemon Go that fueled a powerful rally in the stock this year.
Nintendo’s (7974.JP) release of Super Mario Run marks the company’s first proper foray into smartphone games, and it’s been a long-time coming for the 130-year old company. Nintendo has missed out on the mobile craze, which has spawned mega hits from Candy Crush to Clash of Clans. Sales of its gaming hardware have dwindled. Pokemon Go, which has been downloaded 500 million times, was developed by Google’s Niantic and its impact on Nintendo’s bottom line has been negligible. For the company’s full-blooded mobile debut, players take control of Mario as he runs through levels collecting gold coins and fighting his arch-foe – a large turtle called Bowser.
While the success of the launch of Super Mario Run will dictate the stock’s short term direction, there is more to Nintendo than just its mustachioed Italian mascot. Long-term earnings should lift as the company gradually unlocks the mobile potential of its intellectual property, while new hardware set for next year could get gamers logging on again. The stock is up roughly 70% this year, placing it on track for its biggest calendar year return since 2007, but potential to grow earnings at a double digit pace could lift the stock another 30%.