Super Mario may hop and skip over various obstacles, but Nintendo has its feet rooted. It has stuck with the hardware model, which means game prices remain high to cover those costs. After luring in parents with its family-friendly Wii packages, it now alienates them.
Value investors have bought into the hope that Nintendo, like its game characters, can bounce back. The shares have climbed despite three years of negative operating cash flow and dividends down over 90 per cent since March 2010. This has been helped by a weaker yen (boosting the translation of overseas sales). But the share price has trailed well behind the Topix over the past few years, by 61 percentage points. Read more
As the market waits for ‘Level 3 sectoral sanctions’ against Russia…
Has anyone noticed how the respective share prices of BP and Total have already performed versus the MSCI World Energy this year? Read more
We asked the question, when looking at the $3bn CIT/OneWest deal this week, if bank M&A is finally back. As you are reading the Lex note, think of the following chart, based on Dealogic data, to see just how staggering the falloff in activity has been.
Lex wrote a note today arguing that Facebook shares are overvalued, by pointing out that one has to assume a mind-boggling mid-term growth rate to make sense of the $75 price tag. Here is the thumb-nail growth model used in writing the note:
RBS posted surprisingly high profits on Friday — with shares in the UK bank rising 14 per cent. But what caused it: a decline in impairments, or better top-line growth? Lex discusses that question, and how to value the bank now.
This is a live format in which we’ll share our thoughts on a note we’re writing in real-time, and readers will be able to weigh in too on the right. So don’t be shy! Read more
See you at 12pm (London time), when we’ll be doing an open note on RBS and its surprisingly good preliminary results for the first half of the year…
Apple is hard to value. In the middle of 2013, when the shares were at about $60, Lex wrote:
“Apple’s shares will probably remain in a holding pattern. At 11 times trailing earnings, with a dividend yield of 3 per cent, they trade like shares in a huge, slow-to-no-growth tech company. And until that next revolutionary product rolls around, that is precisely what Apple is.“ Read more
Ever wondered why Vedanta holds so many different companies within its tortuously complex structure?
Thursday’s announcement regarding one of them, Cairn India, gives a very clear example. Vedanta has decided to lend itself, sorry, borrow $1.25bn from Cairn India. Read more
We’re not sure how to complete the joke.
After all, we recently argued that Fiat Chrysler might combine with a Japanese name to become the global carmaker it wants to be. Getting to 7m cars by 2018 (from under 5m last year) is not going to happen under Fiat’s own steam or financial state. And we took it as given that Sergio Marchionne wants to do another big deal.
We didn’t consider Peugeot though. It’s an idea which has done the rounds in the financial houses of Paris before (in 2009 and 2012) but never happened.
Ah, well. As our colleagues Henry Foy, Arash Massoudi and Michael Stothard report on Thursday… Read more
Yes, it is Europe, from the Atlantic to the Mistrals…
That’s one Twitter parody (of Charles de Gaulle, and a certain pair of French warships) we’ve liked about European objections to increasing sanctions on Russia. Read more