DFC Intelligence: Are Game Company Stocks Due to Soar in 2006?

DFC Intelligence takes a look at stock prices and market value of companies in the gaming industry, and also puts things in perspective since the launch of the PlayStation 2 in late 2000.

DFC finds that "the market value of leading interactive entertainment companies has been up 7% from February 2005 through December 2005. This is despite the fact that going into 2005 expectations for the game industry were actually quite low and sales in the early part of the year significantly exceeded most expectations. The second half of the year has been a different story with sales off significantly. However, despite a minor November/December decline, stock prices have held up fairly well."

Market Value of Leading Interactive Entertainment Companies

	Market Value 2/8/05	Market Value 12/15/05	Change
Microsoft	$285,098	$288,386	1%
Sony	$34,500	$36,974	7%
Vivendi Universal	$33,757	$36,290	8%
Nintendo	$16,167	$18,565	15%
Electronic Arts	$19,400	$16,184	-17%
Sega Sammy	$8,270	$10,544	28%
Namco Bandai*	$1,408*	$4,194	198%
Activision	$3,350	$3,599	7%
Square Enix	$3,117	$3,361	8%
Konami	$2,500	$2,989	20%
Midway	$843	$2,059	144%
THQ	$1,120	$1,489	33%
Take-Two Interactive	$1,670	$1,276	-24%
UbiSoft	$703	$943	34%
SCI Eidos**	$395	$744	88%
Capcom	$603	$700	16%
Atari	$330	$154	-53%
Total***	$58,468	$62,607	7%

Estimated market value in millions from the stock price on 2/8/05. For companies that do not report in U.S dollars the exchange conversion was done at 1USD = 105 yen, 1 USD = .55 British pounds and 1USD = 0.8Euro
*Namco Bandai merged in September 2005, February 2005 value is for Namco only
**SCI Eidos merged in spring 2005. February 2005 market value is combined value for SCI and Eidos
***Total Market Value does not include Microsoft, Sony, Vivendi Universal or Namco Bandai

DFC offers up a number of charts and graphs and provides this analysis for the mobile gaming crowd after spending "the holiday season visiting all the major retail chains to evaluate stocking, shelf space, displays and other merchandising issues":

The biggest disappointment we have found so far is what we would consider to be very weak merchandising for the Sony PSP. Many stores have displays for the Nintendo portable systems, but not the PSP. What is worse is the tendency for stores to have a larger selection of UMD movies than PSP games. Furthermore, the movies are often mixed right in with the games. The portable battle is likely to get very interesting over the next two years.

I'd have to say the DS is winning the battle so far. My daughter just got one for her birthday and has been non-stop Nintendogging. There seems to be much more awareness (and desire) among youngsters and non-traditional gamers for the good DS games than I see from the PSP target audience.

Although SOCOM for the PSP is a step in the right direction, the device still hold less interest from my son than his PS2. He's more excited about the XBOX 360 and the imminent Playstation 3. I just don't see much buzz for the PSP, but hopefully Sony can rectify this problem in 2006 with some good, compelling GAMES....