Why Nintendo (NTDOY) Stock is a Compelling Investment Case

Ensemble Capital recently released its Q3 2020 Investor Letter, a copy of which you can download here. The fund posted a return of 11.60% for the third quarter, outperforming its benchmark, the S&P 500 Index which returned 8.93% in the same quarter. You should check out Ensemble Fund’s top 5 stock picks for investors to buy right now, which could be the biggest winners of this year.

In the said letter, Ensemble Capital highlighted a few stocks and Nintendo (NYSE:NTDOY) is one of them. Nintendo (NYSE:NTDOY) is a consumer electronics and video game company. Year-to-date, Nintendo (NYSE:NTDOY) stock gained 40.5% and on October 9th it had a closing price of $68.78. Here is what Ensemble Capital said:

“Nintendo: We initiated our position in Nintendo in April after having studied the company during much of 2019 and believing that the time spent by parents and their children playing video games during shelter in place would likely accelerate the mainstreaming of video games as a form of family entertainment, as opposed to being just games for children or intense, often violent, entertainment for young men. The company’s Switch video game console is not new, yet demand is so strong that the company’s main struggle has been trying to keep up with demand. The market recognizes the way that the pandemic is accelerating the mainstreaming of video games as family entertainment and sent the stock up 26% during the quarter.”


Last week, we published an article revealing that Nintendo (NYSE:NTDOY) stock has outperformed the S&P 500 Index in the trailing one year period.

Our calculations showed that Nintendo (NYSE:NTDOY) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers after its stock price crashed. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free enewsletter below to receive our stories in your inbox:

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