I have a feeling it will probably play out as you expect: earnings inflect higher and Wall Street extrapolates this trend with a high multiple.
However, in the long-run do you think 20x earnings is a fair multiple for a low to no growth company (once it hits the $5-$6bn earnings level)? I'd expect it to be closer to 10x, especially for a non-US company.
We currently own NTDOY as well and have an article about it if you want a read. https://open.substack.com/pub/schwarcapital/p/nintendo-ntdoy-equity-research-report?r=2m1atw&utm_medium=ios
Will do!
I have a feeling it will probably play out as you expect: earnings inflect higher and Wall Street extrapolates this trend with a high multiple.
However, in the long-run do you think 20x earnings is a fair multiple for a low to no growth company (once it hits the $5-$6bn earnings level)? I'd expect it to be closer to 10x, especially for a non-US company.
Good point. This is why I have sell criteria for ntdoy