A few weeks ago, I asked readers to send me their questions regarding the Nintendo (NTDOY) Wii, and the response was staggering, echoing the media's distinct focus on the hot console. So, here are my answers to a small selection of the questions, covering a decent amount of ground, from stocks to Christmas presents.
What's the best way to make money off the Wii?
The easiest way to make money on the Wii is to buy a console at retail and resell it at a big premium. I firmly believe you can make 50% on your money at the very least. But if you're talking stocks, the best way to play the Wii is video-game retailer
, which is currently a pick in the Breakout Stocks newsletter.
As the leading video-game retailer in the country, I expect GameStop to see huge sales of Wii products during the holidays. And unlike retailers like
, GameStop is 100% focused on video games and won't be dragged down by weaker areas of consumer electronics.
Plus, as I pointed out last month,
most third-party Wii games don't sell very well, and thus Wii software sales are a very small percentage of the overall sales of video-game publishers like
( ERTS). GameStop will also benefit from extremely strong sales of non-Wii games like
Call of Duty 4
Is Nintendo artificially controlling the supply of the Wii?
Nintendo probably isn't intentionally holding back supplies of the Wii, simply because it would be foolish to give up sales before the higher-priced Microsoft Xbox 360 and
PlayStation 3 come down in price and become more competitive.
Nonetheless, the fact that demand continues to outstrip supply can be considered a positive from a psychological standpoint -- the harder it is to find something, the more people tend to want it. If Wiis were piled up on store shelves, demand might actually fall.
With video-game graphics becoming so realistic, how can the Wii keep up with its more technologically sophisticated competitors?
It's important to note that with the Wii, Nintendo is aiming for a much broader and more casual audience, which includes people who aren't necessarily attracted to photorealistic graphics and blaring surround sound. Nintendo is placing a clear emphasis on attempting to offer more accessible game play, which it feels will win over converts. This strategy is very different from that of Microsoft and Sony, which have placed their bets on more expensive consoles that tend to attract more serious gamers.
Where can I find a Wii to buy?
Unless you want to pay a bounty on
or Craigslist, I recommend asking local stores when they get their Wii shipments, and then trying to time a store visit to nab one. Also, I recommend avoiding video-game specialty shops and trying places like
, where you'll face less competition for a Wii.
Are there any Wii games that are as fun as the Wii Sports that was included with the console?
I find Wii boxing to be a ton of fun, but if you're looking for a good time outside of that, I recommend picking up
Super Mario Galaxy
Guitar Hero 3
, both of whom are plenty of fun and offer enormous replay value. And going forward to 2008,
Super Smash Bros.
Mario Kart Wii
both look like winners.
I have two daughters, ages 4 and 7. What Wii games are good for them?
I would highly recommend the
High School Musical
. These names are extremely hot with girls and I'm sure your daughters would have a good time. Alternately, they might have a lot of fun playing
Dance Dance Revolution
, which will have the added benefit of giving them some serious exercise.
Do you think your views on video-game stocks are jaundiced by what you prefer gaming-wise?
When researching video-game stocks, I place some emphasis on my firsthand experiences with playing games, but only in the context of forming an opinion on their commercial viability. For example, I was extremely impressed with the multiplayer demo of
Call of Duty 4
, which will be a top seller this holiday season.
But that was only one small factor in my bullish outlook for the game. I also did a great deal of snooping around on message boards, speaking to gamers, and talking with salespeople in game stores, which added up to very strong prospects for the title.
I'd like to thank everyone who sent me a question, and I'll be happy to address any future inquiries on the gaming industry. Feel free to
In keeping with TSC's editorial policy, Michael Comeau doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. Comeau is a research analyst at TheStreet.com. In this role he performs stock analysis for
, and is also a regular contributor to RealMoney.com. Prior to his arrival at TSC in June 2004, Comeau worked as a Consultant to Toyota Motor North America, performing in-depth research on automotive industry issues, primarily in the areas of alternative engine technologies, competitive analysis and macroeconomics. His primary market interests include consumer technology, specialty retail, and small-caps. Comeau received a bachelor's degree in Finance from Brooklyn College, and has completed Level 1 of the CFA program.. He appreciates your feedback;
to send him an email.