Crossroads Capital Investment’s Views on Nintendo Co., Ltd. (NTDOY)

Crossroads Capital LLC, an investment management company, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The Crossroads Capital Investment Partners, LP, appreciated 36.9% net of all fees and expenses in the second quarter of 2025, making the YTD return 26.1% net through Q2 2025. The fund has compounded at 17% (net) since inception. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Crossroads Capital highlighted stocks such as Nintendo Co., Ltd. (OTC:NTDOY). Nintendo Co., Ltd. (OTC:NTDOY) is a video game company that develops, manufactures, and sells home entertainment products. The one-month return of Nintendo Co., Ltd. (OTC:NTDOY) was -4.62%, and its shares gained 63.59% of their value over the last 52 weeks. On October 2, 2025, Nintendo Co., Ltd. (OTC:NTDOY) stock closed at $21.48 per share, with a market capitalization of $101.193 billion.

Crossroads Capital stated the following regarding Nintendo Co., Ltd. (OTC:NTDOY) in its second quarter 2025 investor letter:

“Our thesis on Nintendo Co., Ltd. (OTC:NTDOY), the Godzilla of video gaming, is quite simple. Armed with its Apple-like iterative hardware model and software-based ecosystem, as well as a growing active player base and ever-increasing digital sales, the company should generate substantial earnings growth that is decoupled from the “boom-bust” console cycles of old.

As a reminder, we’ve held Nintendo for six years and counting, drawn initially to its absolute and relative undervaluation and fortress balance sheet, alongside its artistic culture, iconic intellectual property, consistent ability to generate high returns on capital, and historic transition from cyclical earnings to secular growth – attributes, mind you, that remain as we type despite how far the current heavyweight champion of the video game industry has come. And yet, despite all its recent success and a 39.8% return in Q2, we believe the market continues to undervalue the long-tail potential of franchises like Mario and Zelda in an expanding digital entertainment landscape, to say nothing of Wall Street’s still amusing takes on next-gen hardware and software sales.

We’ll get to all that shortly, but what should be immediately obvious right out of the gate is Nintendo delivered a blockbuster quarter on August 1st, powered by the Switch 2’s record-breaking launch. Results that, yet again, have validated both Nintendo’s hybrid Apple-like console strategy and our larger investment thesis, while also demonstrating the company’s pricing power and a level of global market penetration with no historical parallel. To be frank, even the “negatives” had a silver lining in Nintendo’s latest report, as the temporary margin compression that hit Nintendo’s financials should revert sharply as the hardware/software mix normalizes over time and the installed base effect kicks in….” (Click here to read the full text)

A close up of a person’s hands using a home console gaming device.

Nintendo Co., Ltd. (OTC:NTDOY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 1 hedge fund portfolios held Nintendo Co., Ltd. (OTC:NTDOY) at the end of the second quarter, same as 1 in the previous quarter. While we acknowledge the risk and potential of Nintendo Co., Ltd. (OTC:NTDOY) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Nintendo Co., Ltd. (OTC:NTDOY) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.