I think when you said "valued at less than half its current sales" you meant "twice its current sales"."""
Oops, yeah. Thanks for catching that.
Anyways... The more time passes without hearing a peep about a Wii Play replacement, competitor or sequel, the higher this stock should go. Nintendo are aiming to sell 20 million Wiis by March 2008, at which point Wii Play could have sold 8 million; if something isn't announced by E3, it likely isn't coming out in that time period.
I'd also like to respond to the statement "To naively assume that the attach rate will continue for the entire lifetime of this stock, I feel, is a big mistake." Actually, I said 30 million units on 100 million Wiis, or 30% as a high end, and 12 million units on 50 million Wiis, or 24%, as a low end. **The current attach rate is 44%.** In Japan, the attach rate is dropping, and could slip below 50% LTD in the next few months. In America, the LTD attach rate is still rising after the late release, up to 38.5%, and will go higher before it goes lower. Regardless, my expectations include a dropping attach rate. (All numbers derived from VGChartz.)
Some other concerns that were mentioned I just disregard completely. For example, if the price of a controller drops, the price of Wii Play will drop along with it. When Nintendo releases new controller colors, they'd be smart to make certain colors exclusive to Wii Play, to boost sales of the higher profit SKU. Etc. The valid concerns lie in that Nintendo could release a replacement, competitor or sequel to the game, but once again, it will need to be announced soon (or released suddenly), for Wii Play to actually sell LESS than 6 million.
5
I think when you said "valued at less than half its current sales" you meant "twice its current sales"."""
Oops, yeah. Thanks for catching that.
Anyways... The more time passes without hearing a peep about a Wii Play replacement, competitor or sequel, the higher this stock should go. Nintendo are aiming to sell 20 million Wiis by March 2008, at which point Wii Play could have sold 8 million; if something isn't announced by E3, it likely isn't coming out in that time period.
I'd also like to respond to the statement "To naively assume that the attach rate will continue for the entire lifetime of this stock, I feel, is a big mistake." Actually, I said 30 million units on 100 million Wiis, or 30% as a high end, and 12 million units on 50 million Wiis, or 24%, as a low end. **The current attach rate is 44%.** In Japan, the attach rate is dropping, and could slip below 50% LTD in the next few months. In America, the LTD attach rate is still rising after the late release, up to 38.5%, and will go higher before it goes lower. Regardless, my expectations include a dropping attach rate. (All numbers derived from VGChartz.)
Some other concerns that were mentioned I just disregard completely. For example, if the price of a controller drops, the price of Wii Play will drop along with it. When Nintendo releases new controller colors, they'd be smart to make certain colors exclusive to Wii Play, to boost sales of the higher profit SKU. Etc. The valid concerns lie in that Nintendo could release a replacement, competitor or sequel to the game, but once again, it will need to be announced soon (or released suddenly), for Wii Play to actually sell LESS than 6 million.