Just to give people an idea, the 2007 numbers had "January's not usually a month for big numbers in the game industry, but the first month of 2007 was a whopper any way you slice it. NPD recently announced $549 million in non-PC software sales for the month, up an impressive 22 percent when compared week-on-week to last January. Add in $505 million in hardware sales and almost $200 million in accessories and the industry as a whole recorded a huge $1.25 billion in overall sales"
TOP 10 GAMES: December 31, 2006-February 3, 2007: (sales numbers are approximate)
1) Lost Planet: Extreme Condition (Xbox 360, Capcom, Jan. 2007) -- 329,000 copies 2) Guitar Hero II (with Guitar Controller) (PS2, Activision, Nov. 2006) -- 224,000 copies 3) Gears of War (Xbox 360, Microsoft, Nov. 2006) -- 212,000 copies 4) WarioWare: Smooth Moves (Wii, Nintendo, Jan. 2007) -- 201,000 copies 5) Legend of Zelda: Twilight Princess (Wii, Nintendo, Nov. 2006) -- 189,000 copies 6) Madden NFL 07 (PS2, Electronic Arts, Aug. 2006) 7) Legend of Zelda: Twilight Princess (GameCube, Nintendo, Nov. 2006) -- 144,000 copies 8) Resistance: Fall of Man (PS3, SCEA, Nov. 2006) -- 144,000 copies 9) Tom Clancy's Rainbow Six Vegas (Xbox 360, Ubisoft, Nov. 2006) 10) New Super Mario Bros. (DS, Nintendo, May 2006)
I think that the industry has deffinatly grown (and has much better titles, the number one selling title in jan 07 was Lost Planet), so I also believe that this stock is hugely undervalued, my guess is around 65-70 DKP would be a good price.
I dont know why people are saying the december future is too high. We have the wii selling 3million software copies 22december week . Yes we may be losing gears but we gain so much alone in one week from wii sport + wii play and what about PS3? its selling a million software copies a week in december.
I absolutely agree with this. This number out there is obscene. $600M in sales, or a 10% increase when:
1) There's 1 less weak in sales (which is essentially a 20% drop in sales, or $450M normalized).
2) January loses it's best week to December (the first week of the month - Dec 30 - Jan 5, because of the retail calendar shift), which is replaced by Jan 27 - Feb 2, a MUCH, MUCH weaker week.
The Total Software Sales NPD December 2007 looks potentially to be significantly inflated to me.
@ $2.5B in sales, it's assuming a 60% jump over last year. This despite a few factors.
1) December has lost the week after Christmas to November (which helps to account for the 62% jump in November). In it's place, it gets Dec 30th - Jan 5, a much, much weaker week. If you normalize the data, this number essentially would be predicting a 75% increase in sales
2) Last years $1.73B was an industry record (which almost every year gives us), and while COD4, SM Galaxy, Assassins' Creed, Guitar Hero, & Wii Play are going to dazzle, we lose 800k of Gears of War, 1.5M units of Zelda, 875k of Cars, and the traditional franchises looking to have lost substantial steam. (Madden, NFS, Tony Hawk, & Smackdown).
A 30% or less increse in the face of the change in the retail calendar looks much safer to me, which would translate to $2.1B in sales.
I'm very, very bullish on SW sales with the 360, Wii, & DS doing so well, but the number just looks way too big to me.
Software Sales for January 2007 were $549 million. Keep in mind this was for a 5 week reporting period, for this future (January 2008) NPD is only reporting for a 4 week period. Also, take into account the credit crunch that is starting to have an effect on the American consumer (much more so than the easy credit of late 2006 and early 2007). Retail sales are not meeting even the modest expectations (link to article more about this) and I expect that the video game industry cannot remain immune from this forever. Due to all these circumstances (especially the different reporting periods 4 weeks this year instead of 5 weeks last year) the current price is overvalued and should be somewhere around 55DKP.
Remember, last year (2007) NPD reported January as a five week period. In January 2008 NPD will be reporting as a four week period, so making a direct comparison between 2007 and 2008 will not produce accurate results.
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