Nintendo has become one of the top 5 companies of Japan valued at 53 billion dollars given today's stock and currency prices.  10% of the company is owned by former Nintendo president Hiroshi Yamauchi, who is also the richest person in Japan.

I'm looking into Nintendo as an investment and here is what I'm seeing today:

Nintendo's American ADR closed at $47.42 today and closed at 34,200 yen in Japan:

They are predicting 2,697 yen/share as of November 2008

~they included the falling dollar and yen conversion rate in that estimate (previous estimate was 20% higher)

They have a great balance sheet which at today's prices is 9.2 billion dollars or 17% of their market cap.

Lets do this in yen:

They are guiding for 2,697 yen per share through March 2009 and trade at 34,200 yen - approximately 6,000 of that is cash, so taking out the cash (and including the interest income), we get a multiple of 28,200  divided by 2,697 equals 10.46

A multiple of 10 for the number one publisher and console maker in the world, where publishers are scrambling to make hit games on their giant install base?

Looks like an incredible bargain to me unless I'm missing something.

Oh, and one more thing... they pay a 4.7% dividend yiled given today's prices.  Incredible.

I haven't researched Japan's average valuation multiples (I imagine they are lower than the U.S.), but if my numbers are correct, I'm asking myseslf why I haven't noticed this stock before.  Some say Nintendo has peaked in Japan and will soon peak in the U.S., but nevertheless I see downside risk as minimal because a greater install base means growing higher margin publishing revenues.