Nintendo Co. Ltd. briefly zipped past Sony Corp. in market capitalisation today to become one of Japan's top ten valuable stocks as it elbows the PlayStation maker out of its decade-long dominance of the game industry.
Nintendo joined global household names such as Toyota Motor Corp., Honda Motor Co. and Canon Inc. on the list of the ten most valuable Japanese companies before its shares erased earlier gains and ending the day lower.
The Kyoto-based company finished in 11th place in market value, sandwiched between Panasonic maker Matsushita Electric Industrial Co. at the bottom and Sony on top - the world's largest and second-largest consumer electronics makers each having sales more than eight times as big as Nintendo's.
"It is becoming quite clear that Nintendo is taking back its market share from Sony in the console market while well defending its stronghold of portable games," Mizuho Securities analyst Takeshi Koyama said.
Nintendo's Wii game console has outsold Sony's PlayStation 3 by three to one in Japan, and by more than two to one in the United States so far this year, according to game magazine publisher Enterbrain and research firm NPD.
Demand for its DS handheld game players also far outstripped that for Sony's PlayStation Portable.
Mizuho's Koyama said, however, that investors should watch out for a possible pull-back after two year-long bull runs.
"This is one of those companies that is not exactly making daily necessities. One negative factor and shares could take a dive. We need to be careful in dealing with shares like this," Koyama said.
Shares in Nintendo rose as high as 46,350 yen, a record high, in the morning session, boosting its market value to 6.57 trillion yen (€39 billion) and narrowly surpassing Sony's market capitalisation.
Nintendo, however, closed down 0.8 per cent at 45,100 yen, bringing down its market value to 6.39 trillion yen, a touch below Sony's 6.48 trillion yen. Sony shares have put on 66 per cent over the past two years,