Shares of Nintendo (NTDOY) were rising in Monday morning trading after Credit Suisse boosted its rating on the electronics and video game firm to "Outperform" from "Neutral," predicated on a boost in sales of the company's Switch game console.
Credit Suisse sees Nintendo almost doubling the number of Switch consoles sold to 130 million units through 2022, up from Wall Street's projected 70 million.
"As Nintendo's Switch is a unique game platform for use as either a console or handheld, there was initially some uncertainty over whether it's sales cycle would more closely resemble that of a console or handheld," Credit Suisse analyst Keiichi Yoneshima wrote in a note obtained by Barron's. "Although the Switch is currently categorized as more of a console, we expect it to sell like a handheld."
Yoneshima believes sales will be powered by consumer's desire to own the console based on its portable and handheld characteristics.
"We now expect the Switch to achieve peak sales about five years after launch like a typical handheld game device. We also raise our peak-year sales forecast," Yoneshima noted.
The analyst upped his estimates for peak year unit shipments to 31 million from 25 million.
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