Nintendo Co (NTDOY) AI Stock Analysis

• Market Cap: $67.11B
• Dividend Yield: 0.84%
• Average Volume (3M): 2.78M
• Price to Earnings (P/E): 24.5
• Beta (1Y): 1.16
• Revenue Growth: 25.64%
• EPS Growth: 13.40%
• Country: US
• Employees: 7,724
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.88
• Shares Outstanding: 5,194,760,000
• 10 Day Avg. Volume: 1,703,995
• 30 Day Avg. Volume: 2,776,607
• PEG Ratio: -1.00
• Price to Book (P/B): 4.40
• Price to Sales (P/S): 10.29
• P/FCF Ratio: -1.73K
• Enterprise Value/Market Cap: 129.10
• Enterprise Value/Revenue: 5.81
• Enterprise Value/Gross Profit: 11.66
• Enterprise Value/Ebitda: 31.20
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 2.28
• Revenue Forecast (FY): $14.93B

• Rating: 58 Neutral
• Price Target: $14.00 ▲(0.00% Upside)
• Action: Reiterated Date: 02/06/26
• Date: Action: Reiterated 02/06/26

The score is primarily supported by Nintendo’s high-quality profitability and extremely strong, low-leverage balance sheet, but is capped by the FY2025 cash flow breakdown (negative free cash flow) and recent revenue/earnings decline. Technical signals further weigh on the score due to a clear downtrend, while valuation offers only modest support given the P/E and low dividend yield.

Positive Factors

Conservative balance sheet

Nintendo’s essentially debt-free balance sheet and substantial equity provide durable financial flexibility. Low leverage supports sustained investment in first‑party studios, licensing initiatives and hardware development, and cushions the company through cyclical revenue swings without refinancing risk.

High-margin profitability

Consistently strong gross and operating margins underpin long-term cash generation potential and pricing power across hardware, first‑party software and digital sales. High margins help fund R&D, IP monetization and marketing even when unit growth slows, supporting durable earnings capacity.

Strengthening third-party content pipeline

Confirmed AAA third‑party releases for Switch 2 broaden the console’s software ecosystem, reducing sole dependence on internal studios. A deeper third‑party pipeline can extend platform lifecycle, raise software attach rates and diversify revenue sources from digital sales and subscriptions over multiple years.

Negative Factors

Deteriorating cash generation

A swing to negative free cash flow in FY2025 is a meaningful structural concern versus Nintendo’s historical cash conversion. Reduced FCF limits the company’s ability to internally fund large first‑party projects, hardware investments or increased shareholder returns without drawing on cash reserves.

Recent revenue and earnings decline

A shift from prior growth to revenue and earnings declines signals weakening demand or a product‑cycle trough. Sustained top‑line contraction can erode operating leverage and reduce the pool of funds for content development and IP initiatives, challenging medium‑term growth sustainability.

Dependence on hardware cycle and first‑party cadence

Nintendo’s platform model ties revenue to installed base expansion and timing of marquee first‑party releases. This structural dependency produces lumpy revenues and heightens execution risk: slower hardware adoption or gaps in first‑party hits can materially compress attach rates and recurring digital revenue.

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 several key streams. The primary source is the sale of gaming hardware, such as the Nintendo Switch console and its various models, including the Switch Lite. In addition, Nintendo earns significant income from software sales, which includes both physical and digital game titles. The company's vast library of games, featuring popular franchises like Super Mario, The Legend of Zelda, and Pokémon, contributes to strong software sales. Nintendo also monetizes through digital services, including Nintendo Switch Online, a subscription-based service that offers online multiplayer gaming, classic game libraries, and other features. Licensing agreements for merchandise and media adaptations of Nintendo's intellectual properties further supplement its revenue. Strategic partnerships, for instance with game developers and media companies, enhance its offerings and expand its market reach.

Nintendo Co Financial Statement Overview

Summary

Strong profitability and an exceptionally conservative balance sheet (negligible debt) support resilience, but fundamentals weakened in the most recent year with revenue and earnings declining and a sharp deterioration in cash generation (negative free cash flow in FY2025), which meaningfully raises near-term risk.

Income Statement

Profitability remains a clear strength, with consistently high gross and operating margins and strong net profitability across the period. However, growth has turned negative in the most recent year (revenue down ~5.5% in FY2025 vs. modest growth in prior years), and earnings also stepped down materially from FY2024 levels—suggesting a weaker near-term trajectory despite an otherwise high-quality margin profile.

Balance Sheet

The balance sheet is exceptionally conservative: debt is effectively negligible (including a zero debt figure in FY2025) and equity is substantial relative to the asset base. Returns on equity have been solid historically (high-teens to mid-20% in earlier years) but moderated in FY2025, reflecting the earnings slowdown rather than financial leverage risk.

Cash Flow

Cash generation quality is mixed and deteriorated sharply in FY2025: operating cash flow collapsed to a very small level and free cash flow turned negative, which is a meaningful red flag versus prior years where free cash flow was strong and closely tracked net income. The magnitude of the swing suggests higher working-capital or timing volatility, reducing confidence in near-term cash conversion despite a historically strong record.

Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
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	277.70B	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	3.15T	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	327.14M	0.00	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: Negative
• Last Price: 14.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTDOY, the sentiment is Negative. The current price of 14 is below the 20-day moving average (MA) of 14.26, below the 50-day MA of 15.72, and below the 200-day MA of 20.15, indicating a bearish trend. The MACD of -0.61 indicates Negative momentum. The RSI at 41.11 is Neutral, neither overbought nor oversold. The STOCH value of 46.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NTDOY.

Nintendo Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTES	74 Outperform	$70.33B	15.77	22.36%	2.19%	5.69%	32.87%
EA	70 Outperform	$50.19B	75.30	10.03%	0.37%	-1.45%	-11.99%
BILI	65 Neutral	$11.75B	108.77	5.30%	―	16.84%	―
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
NTDOY	58 Neutral	$67.11B	24.49	14.81%	0.84%	25.64%	13.40%
TTWO	57 Neutral	$39.16B	―	-86.22%	―	13.98%	-6.71%
RBLX	52 Neutral	$48.66B	―	-345.84%	―	32.70%	12.57%