Nintendo Co., Ltd.
Thesis
Nintendo is positioned as a fulcrum asset with a strong cultural approach that prioritizes customer satisfaction over immediate profit maximization. With the anticipated launch of the Switch 2, which addresses previous hardware limitations, the company is expected to generate owner earnings of 720 yen per share, translating to a 7% yield and a mid-teens IRR, making it an attractive investment relative to opportunity costs.
Did it work?
The stock price has decreased by 3.8% since the pitch, which contradicts the long thesis that anticipated a strong return driven by the launch of the Switch 2 and improved earnings. Given that 28 months have passed, which is more than half of the typical investment horizon for such a thesis, the lack of positive price movement indicates that the expected catalysts have not materialized as projected.
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