Tuesday, July 26, 2016

Dreamlist for Outdoor Gear

In preparation for my big road trip / backcountry hiking trip - I have come to conclude that these are the gears I wish I can own. High quality ultra lightweight gear that is worth the $$$$.

Gear Wishlist      

  1. Hyperlite Mountain Gear (HMG) 3400 Bacpack

    Weight: 32 oz | 907g      Price: $330

    Backpacker Mag's best ultraweight backpack. Cuben Fiber Hybrid makes up its fabric, a highly durable Dyneema material that is 50-70 percent lighter than Kevlar and four times stronger. It was this or the ZPacks Arc Blast but aesthetics, functionality, little bells and whistles (minimalism!) won me over.

  2. Therm-a-Rest NeoAir XTherm Sleeping Pad

    R-value: 5.7      Weight: 15 oz (Reg)      Pack Size: 1L      Thickness: 1.5 in      Price: $

    Cheaper alternative: NeoAir XLite ($159) or ProLite Plus ($99)
  3. HMG UltaMid 2

    With a bathtub interior mesh!
  4. Suunto Traverse Sapphire Black

  5. Zpacks Cuben Fibre Poncho/Footprint/Packcover

    Weight: 6 oz      Price: $175
  6. Komperdell Ultralite Vario 4 Compact

    Weight: 14 oz | 396 g      Price: $239

    Cheaper alternative: Black Diamond Distance FLZ Trekking Poles ($129) and Alpine Carbon Z ($189)
  7. BioLite BaseCamp Wood Burning Stove
  8. Oru (Origami) Kayak


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Tuesday, July 19, 2016

Nintendo: bullish or bearish?

a Newbie's Guide...

[July 19th 11:00 CDT]

Source: YAHOO! Finance

Going long with Pokemon Go Nintendo (NTDOY)?

Only if you were in the market the first three days after Pokemon Go was released, tbh.

Yes, you may say it has been going up the last eight days, but has anyone tried to understand why it's going up?
 $310 per share (33,000 ¥), is it justified?

P/E ratio is at 230 right now. Which means people are paying 230 times more than what they are actually earning.

Now let's get to the point...

  • Pokemon is very huge in Asia and it's not released in Asia yet
  • Gaming industry is very big in Asia, hence potentially profitable 
  • Nintendo owns brand rights to Pokemon

REALITY CHECK - what's the bigger picture?
  • Nintendo owns 10% shares in Creatures Inc, originator of Pokemon
  • Nintendo owns 32% shares of Pokemon Company, which with Niantic, a Google spin-off the company helped Niantic Inc. develop Pokemon Go 
  • Niantic Inc, the main developer and distributor, also owns the platform of Pokemon Go, so majority of fees will go to them (30% goes to Apple, being an app)
  • Being the first AR game for the masses, development fee is massive (they had to raise $20mil in capital for Niantic)
  • Nintendo will not get profits directly from Pokemon Go, only royalties (sounds like about 10-16% profit margin, which is not much)

Source: WSJ

(More) Cons:
  • Fan-base for first generation Pokemon are mostly millenials - so release of the subsequent gen of pokemon would not keep players engaged long enough (speaking from a millenial herself who is into the gaming industry)
  • How can Nintendo (or more like Niantic and Alphabet Inc) keep the booming popularity and maintain players' interest. Millenials are at the age where they can afford to spend on in-app purchases, but also the fastest to get bored and move on
  • Gen-Z are the ones that should be appealed as they're the generation that mobile gaming profits the most from (parents will certainly spend on their children than themselves!)
  • Game relies on people going out to play - safety issue a big thing in Asian countries and concerned Asian parents, 3G/4G limitations in poorer parts of Asia
  • Pokemon Go is a micro-transaction model but since it depends on users going out to different stops - it actually discourages the pay-to-play
  • How long until it releases in Asia? Delays in launch of Pokemon Go in Asia will worry investors.


American market is a consumerism capitalist, so it's expected to be profitable there. Releases in Europe wouldn't be as big of a profit, remember, number of downloads does not equate profits. Think of the European and English culture and how it's related to the gaming industry there, it's never a big gain there. They'd happily download it (it's free to do so) but would be much more reluctant to spend on in-app purchases like their Asian and American counterparts.

  • The company has been performing poorly in Q3 and Q4 with console sales and has a poor outlook of the next fiscal year 2016/2017
  • Has always been skeptical about mobile gaming but will need to move quickly into the arena to keep up with Pokemon Go momentum

High-Yield High-Risk:
  • Investors are investing in 'hope', rather than actual quants.
  • Investors are banking in on quick profits, but mainly short-term
  • A lot of these investors are a combination of young investors and seasoned investors hurt by worldwide dip in indexes thanks to Brexit and generally sluggish worldwide economy.
  • It's a ticking bomb so timing is essential to get in and get out

Question is,
  1. How long will Nintendo's shares keep going up at this rate? - Until Nintendo reports its next quarterly profits which won't be as what people expect (duh) which will then send the shares crashing, unless they can come up with something quickly the next two months +
  2. Will its release in Asia push it further up? - yes if it can get into China's market asap before counterfeits and copies come in
  3. How does Pokemon Go keep players from getting bored once they've reached the level and amount of Pokemon caught that they're contented with?
KING's performance prior to acquisition by Activision. Source: Bloomberg

A similar case study, KING Digital Entertainment, the company which developed Candy Crush thought they were going to be big but ended up opening below their IPO and stagnated before being acquired by Activision (ATVI). Yes, people will argue that there is a loyal fanbase with Pokemon, but Candy Crush appeals to a wider range of ages rather than just millennials.

My own super rough prediction, since there are currently no models in predicting the future of NTDOY

My conclusion: Slightly bullish for the next week but generally bearish.

Just my two-cents!

My background? I am a millenial who plays moderately (currently on Level 15 with 57 pokemon on the Pokedox. Team Valor!).


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