Pokémon Go became an overnight sensation, and savvy investors bought Nintendo stock, causing the share price to spike. But when Nintendo issued a statement to remind everyone that its stake in the app is just 13 and that revenue from the game was already taken into account in its forecasts, the stock price plummeted 18%, after which the Tokyo stock market halted trading to prevent a further decline.
Via Bloomberg:
The correction comes after Pokemon Go's release almost doubled Nintendo's stock through Friday's close, adding $17.6 billion in market capitalization. Nintendo is a shareholder in the game's developer Niantic Inc. and Pokemon Co., but has an "effective economic stake" of just 13 percent in the app, according to an estimate by Macquarie Securities analyst David Gibson.
"It's still possible to say that in the short-term it's overheated," said Tomoaki Kawasaki, an analyst at Iwai Cosmo Securities Co.
