Nintendo Co (7974) AI Stock Analysis

• Market Cap: $14.52T
• Dividend Yield: 0.99%
• Average Volume (3M): 4.54M
• Price to Earnings (P/E): 49.4
• Beta (1Y): 0.88
• Revenue Growth: 2.30%
• EPS Growth: -24.75%
• Country: JP
• Employees: 7,724
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 82.48
• Shares Outstanding: 1,298,690,000
• 10 Day Avg. Volume: 4,242,220
• 30 Day Avg. Volume: 4,539,180
• PEG Ratio: -0.98
• Price to Book (P/B): 4.32
• Price to Sales (P/S): 10.10
• P/FCF Ratio: -1.70K
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 9.59
• Enterprise Value/Gross Profit: 19.25
• Enterprise Value/Ebitda: 40.94
• 1Y Price Target: $14,323.67
• Price Target Upside: 11.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 56 Neutral
• Price Target: ¥13,045.00 ▲(1.40% Upside)

Nintendo's overall stock score is primarily influenced by its strong financial foundation and profitability, despite challenges in revenue growth and cash flow. The technical analysis indicates bearish momentum, and the high P/E ratio suggests potential overvaluation. These factors collectively result in a moderate stock score.

Positive Factors

Strong Market Position

The strong sales performance of Nintendo Switch 2, surpassing competitors like PlayStation 5 and Xbox Series, highlights Nintendo's robust market position and consumer demand for its products, supporting long-term revenue stability.

Iconic Franchises

Nintendo's iconic franchises provide a durable competitive advantage, ensuring sustained consumer interest and brand loyalty, which contribute to long-term revenue generation and market presence.

Low Financial Leverage

Nintendo's low financial leverage enhances its financial stability and flexibility, allowing it to invest in growth opportunities and weather economic downturns without significant financial strain.

Negative Factors

Declining Revenue

The decline in revenue over recent years suggests potential challenges in maintaining growth momentum, which could impact long-term profitability and market competitiveness if not addressed.

Negative Free Cash Flow

Negative free cash flow indicates potential issues in cash generation, which could limit Nintendo's ability to fund operations and invest in new projects, affecting long-term growth prospects.

Potential Tariff Impact

Potential tariffs on electronic devices could increase costs for Nintendo, affecting profit margins and pricing strategies, potentially impacting competitiveness and financial performance in the long term.

Nintendo Co Business Overview & Revenue Model

Company Description

Nintendo Co., Ltd., together with its subsidiaries, develops, manufactures, and sells home entertainment products in Japan, the Americas, Europe, and internationally. It offers video game platforms, playing cards, Karuta, and other products; and handheld and home console hardware systems and related software. The company was formerly known as Nintendo Playing Card Co., Ltd. and changed its name to Nintendo Co., Ltd. in 1963. Nintendo Co., Ltd. was founded in 1889 and is headquartered in Kyoto, Japan.

How the Company Makes Money

Nintendo generates revenue through multiple key streams. The primary source is hardware sales, which includes the sale of consoles like the Nintendo Switch and handheld devices. Software sales also represent a significant part of its revenue, as the company publishes and sells both first-party titles (games developed in-house) and third-party titles (games developed by external developers). Additionally, Nintendo earns money from digital content sales, including downloadable games and in-game purchases through its online services. The company has also established partnerships with third-party developers and publishers, which can enhance its software offerings. Furthermore, Nintendo has ventured into mobile gaming, creating smartphone apps that complement its gaming ecosystem. Royalties and licensing fees from merchandise and media adaptations of its franchises contribute to its earnings as well.

Nintendo Co Financial Statement Overview

Summary

Nintendo exhibits strong profitability and a solid balance sheet with low leverage. However, declining revenues and negative free cash flow in the latest year highlight potential growth and cash flow challenges.

Income Statement

Nintendo has demonstrated strong profitability with a consistent gross profit margin above 55% and a net profit margin around 24% in the latest year. However, revenue has declined over the past two years, indicating potential challenges in growth. The EBIT and EBITDA margins remain robust, reflecting efficient operations.

Balance Sheet

The company maintains a very low debt-to-equity ratio, indicating minimal leverage and financial risk. The return on equity is healthy, though it has decreased from previous years. The equity ratio is strong, suggesting a solid financial foundation.

Cash Flow

Operating cash flow has decreased significantly, and free cash flow turned negative in the latest year, raising concerns about cash generation. The free cash flow to net income ratio is negative, indicating potential cash flow issues despite profitability.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.49T	1.16T	1.67T	1.60T	1.70T	1.76T
Gross Profit	742.86B	710.17B	954.34B	885.44B	946.04B	970.47B
EBITDA	349.25B	387.69B	698.75B	611.92B	603.29B	651.43B
Net Income	293.88B	278.81B	490.60B	432.77B	477.69B	480.38B
Balance Sheet
Total Assets	3.47T	3.40T	3.21T	2.85T	2.66T	2.45T
Cash, Cash Equivalents and Short-Term Investments	1.91T	2.06T	2.25T	1.88T	1.71T	1.74T
Total Debt	47.25B	7.16B	6.13B	6.29B	6.23B	5.77B
Total Liabilities	770.16B	673.07B	546.40B	587.82B	593.08B	572.30B
Stockholders Equity	2.70T	2.72T	2.60T	2.27T	2.07T	1.87T
Cash Flow
Free Cash Flow	0.00	-6.94B	445.97B	300.65B	282.07B	605.10B
Operating Cash Flow	0.00	12.07B	462.10B	322.84B	289.66B	612.11B
Investing Cash Flow	0.00	753.06B	-630.63B	111.51B	93.70B	-136.53B
Financing Cash Flow	0.00	-195.13B	-236.96B	-290.97B	-337.01B	-194.94B

Nintendo Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12865.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7974, the sentiment is Positive. The current price of 12865 is above the 20-day moving average (MA) of 12718.84, below the 50-day MA of 13305.96, and above the 200-day MA of 11718.53, indicating a neutral trend. The MACD of -205.39 indicates Negative momentum. The RSI at 50.11 is Neutral, neither overbought nor oversold. The STOCH value of 37.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7974.

Nintendo Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6460	70 Outperform	¥561.21B	35.76	4.51%	1.81%	-12.78%	-56.73%
3659	68 Neutral	$2.45T	24.52	10.04%	0.94%	2.84%	51.14%
9766	67 Neutral	¥2.96T	39.22	16.24%	0.84%	13.45%	16.03%
9697	66 Neutral	¥1.73T	30.97	26.13%	1.01%	34.28%	58.34%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
9684	57 Neutral	$1.12T	59.56	5.77%	1.65%	-7.85%	-3.39%
7974	56 Neutral	$14.52T	49.40	11.31%	0.99%	2.30%	-24.75%