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Nintendo is expanding the footprint of its valuable intellectual property (IP) across movies to merchandise and theme parks. The gaming giant is betting on nostalgia and new gamers to drive sales of its flagship Switch 2 console and key games.

Nintendo plans an unwinding of strategic shareholdings that would see companies including MUFG Bank and the Bank of Kyoto selling shares of the "Super Mario" maker, according to three sources familiar with the situation.

Nintendo is rated a buy, driven by the Switch 2 launch and robust free cash flow yield above historical levels. Switch 2 sales are pretty strong, with expectations for a long sales tail and significant deferred demand as the game library matures. Major upcoming catalysts include new Mario and Zelda movies, each with the potential to add over 20% to run-rate net profit in their respective years.

REDMOND, Wash.--(BUSINESS WIRE)-- #nintendoswitch--This week's Nintendo Download includes the following content: Nintendo eShop on Nintendo Switch and Nintendo Switch 2: Resident Evil Requiem – A new era of survival horror arrives with the latest entry in the acclaimed Resident Evil series. Dive into the action with FBI analyst Grace Ashcroft and veteran agent Leon S. Kennedy, as both of their journeys and distinct…

Nintendo is upgraded to a Buy after a 40% stock correction restores valuations to historical averages. Switch 2's launch allowed sales to double YoY, with robust margins and a strong cash position backing 25% of market cap. Dividend yield is projected at 3.4% for mid-2027, supported by healthy payout ratios and expected earnings growth through the Switch 2 cycle.