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TRADING UPDATE FROM THE BUZZ & BANTER
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Nintendo Co. Ltd. (OTCMKTS:NTDOY) is up 12% in two days, with today's 7% boost coming courtesy of investment bank Mizuho, which raised its target price on the stock (which trades in Japan under the ticker 7974) to 14,000 yen from 12,000 yen.

Note that Nintendo shares are currently trading at 13,540 yen in Japan, so Mizuho is actually making a big turnaround in its view.

Mizuho noted that the overseas introduction of Animal Crossing: New Leaf in June will continue to boost sales of the 3DS handheld, with new titles extending the momentum towards the end of the year.

This seems like a belated reaction to the ACNL-driven 3DS boom, which we've been charting steadily in the Buzz. You can see an updated chart here:



Note, however, that Nintendo's public comments at the E3 conference indicated that the 3DS performance post-ACNL was actually better than what the VGChartz estimates imply -- Nintendo said that US 3DS sales rose four-fold, while the VGChartz estimates showed a three-fold increase. So it's possible that these figures are actually underestimating the 3DS' momentum.

Nonetheless, Wall Street's generally negative view of Nintendo, courtesy of the poor performance of the Wii U console, is an important factor in the current surge in the stock.

The Wii U's weakness, while a big detriment to the company, is already built into expectations, but the strength of the 3DS is perhaps not. Therefore, if we have a situation where the Wii U merely sells as expected (read: poorly) and the 3DS outperforms, we could see a massive ongoing rally in Nintendo shares similar to Blackberry's (BBRY) in the second half of 2012.

The big risk is that the ACNL boom is only temporary, and 3DS sales fail to sustain themselves at a higher level than before ACNL was released.

But for now, I'm staying long as I'm encouraged by all the negative headlines in the light of the 3DS' momentum.
POSITION:  Position in NTDOY
TICKERS:  NASDAQ:BBRY, NYSE:NTDOY   

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