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Sony Stock: Buy It While Demand Is Robust

Posted On September 1, 2017 3:51 pm
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Investors are bullish on Sony Corp (ADR)(NYSE:SNE) as the company continues to thrive on the back of VR, gaming and digital display industry. Sony stock is up over 39% so far this year. In the fiscal first quarter, Sony’s operating profit came in at $1.4 billion, thanks to the rising sales of smartphone sensors, 4K display devices and cameras.  

The results show that Sony is on track to meet its profit target of 500 billion yen. Sony’s semiconductor revenue increased by a whopping 41%, mainly due to the rising demand of sensors. Despite a strong volatility in image sensors market, Sony is expected to enjoy a robust demand in the coming quarters.

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In April, reports regarding PlayStation sales resulted in a negative sentiment after several analysts said that PS sales had plateaued. But the latest numbers show that PlayStation has a massive growth opportunity.

Analysts think that the company’s exclusive game titles will boost

Sony stock numbers. The company is set to launch the latest version of Spiderman game in 2018. Spiderman Homecoming movie’s huge success this year shows that Spiderman game will be a blockbuster.

Sony’s decision to recast itself as a video gaming and entertainment powerhouse in the industry is bearing fruit. PlayStation 4 remains almost twice as popular as its biggest competitor Xbox One. Sony has a 14% global market share in consoles. It has sold over 60.4 million units of the console till June this year. PS4 Pro and PlayStation VR are also raking in huge revenues for the company. PlayStation VR also gives Sony a key edge in the virtual reality market.

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Sony Pictures division which has failed to impress the market in 2017 is also expected to go through a major reinvigoration. The division is expected to swing to profits in the last quarter of 2017.

Recently, Goldman Sachs said in a report that the launch and success of Spiderman movie by Sony heralded a positive era for Sony pictures. Sony’s decision to enter the lucrative market of exclusive content is paying off. Shows like “Better Call Saul” and “The Last Tycoon” are crushing the Street’s estimates.

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