Wedbush Morgan’s Michael Pachter has dismissed talk of games revenues peaking this year as “rubbish”.
The analyst said game stock had underperformed this year, and there was still plenty to get out of this generation.
“Share prices for the publishers have underperformed this year, as concerns about a weak macro continue to linger. Investors appear to remain skeptical about the video game consumer, and investor pessimism was exacerbated by weak industry outlooks from Activision, Electronic Arts, Nintendo, THQ, Take-Two, and Ubisoft. In addition, it appears to us that many investors remain convinced that industry growth will peak in 2009, given that this year is the fourth year of the current cycle, and given urban legend that video game sales always peak in year 4,” he said in a note.
“We say ‘rubbish’, and note that video game software sales typically peak in the year prior to the introduction of a new generation console, as many consumers begin to slow purchases in anticipation of purchasing a new console the next year.”
More on GameDaily. March’s NPD will release this Thursday.