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Nintendo Faces More Pressure After Biggest Drop in 26 Years

  • Impact from Pokemon Go seen limited for current fiscal year
  • Focus is on whether new games, tie ups will help lift profits
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Do Nintendo Shares Have Further to Fall?

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Nintendo Co. posted its worst drop in 26 years Monday after the company poured cold water on the notion that the explosive popularity of Pokemon Go would translate into steady profits. Unfortunately for investors, the worst may be yet to come.

The Kyoto-based firm was valued at 109 times projected net income after Monday’s plunge, or more than 6 times the average for the Nikkei 225 Index. The company has already said it doesn’t expect Pokemon Go will yield enough profit to increase its earnings outlook for the fiscal year.