Switch 2 Scalpers Are Auctioning Off Their Preorders to the Highest Bidder
People hoping to score Nintendo's new console this week are finding them on resale websites—at several hundred dollars over the retail price of $450. The Nintendo Switch 2 Courtesy of Nintendo
Nintendo's Switch 2 launch is underway worldwide. The console officially releases June 5, meaning buyers in territories in earlier time zones have already gotten their hands on it. As midnight rolls across North America, players here will do the same. Many fans preordered their Switch 2, allowing them to skip the in-person lines planned for midnight sales at retail stores. Others are currently bidding on consoles being sold by scalpers.
Sellers on sites like eBay and Mercari have created their own ecosystem of preorder sales, capitalizing on fears that the ongoing tariff drama and possible stock shortages will make the Switch 2 scarce. The console, which retails at $450, is selling for several hundred dollars more on the resale sites. One listing, which promises to ship June 6, is selling for $849 or 'best offer.' Other listings are actively being bid on. On Mercari, consoles are selling in the $600 range and above.
There are good reasons for people to be anxious. Nintendo has a history of supply shortages, including with the Switch 2's predecessor; in Japan, the company has already warned customers that demand may exceed supply. Nintendo prepared for the possibility of scalping ahead of the game console's preorder period; buyers who wanted a unit directly from their stores could only purchase one system per account and had to meet specific requirements, including 50 hours of playtime on their Switch account.
Buyers who wanted to snatch more than one Switch could still place multiple orders through other retailers, like Amazon or Walmart. According to online message boards, some did; others confessed to buying from scalpers after failing to find their own. 'I have no shame,' wrote a user on the GameFaqs forum. 'Roughly 700.00 [USD]. Including priority air next day shipping…no Mario Kart bundle. I couldn't wait any longer.'
Reached by WIRED, Nintendo would not immediately comment. Earlier this month, the company announced that it would be working with Mercari, Yahoo Auctions, Yahoo Fleamarket, and Rakuten Rakuma to remove listings and ban users—but only in Japan. Crackdowns on the resale sites will begin June 5 as part of a probationary period. It's unclear if these measures will be implemented in other regions.
The global market may also yet have a part to play. Nintendo made the unprecedented move of temporarily delaying preorders after the console's in-person unveiling, following extreme tariff announcements made by President Donald Trump. Although the price of the console itself hasn't been impacted—for now—many accessories are now more expensive than previously announced. As even older game consoles grow more expensive, it's not impossible that the Switch 2's price will increase after launch.
Still, buyers turning to secondhand sellers may be left Switchless after all, due to preorder delays and cancellations. Earlier this week, some retailers were reportedly canceling preorders due to system errors or stock shortages.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
25 minutes ago
- Yahoo
Make Over a 2.4% One-Month Yield Shorting Nvidia Out-of-the-Money Puts
Nvidia Inc. (NVDA) stock is cheap based on free cash flow (FCF) price targets. Investors can short out-of-the-money (OTM) NVDA put options to make a 1-month 2.4% yield. This is at 5% lower exercise prices, providing a cheaper potential buy-in point for investors. NVDA closed at $143.85 on Friday, June 20. In my last Barchart article on May 30, I argued that NVDA stock was worth $191.34 per share. That is still one-third (+33.0%) higher than Friday's price. The Saturday Spread: Statistical Signals Flash Green for CMG, TMUS and VALE Make Over a 2.4% One-Month Yield Shorting Nvidia Out-of-the-Money Puts Stop Missing Market Moves: Get the FREE Barchart Brief – your midday dose of stock movers, trending sectors, and actionable trade ideas, delivered right to your inbox. Sign Up Now! This article will discuss one way to play NVDA by shorting out-of-the-money (OTM) puts. That way, an investor can set a potentially lower buy-in point and get paid for this. But first, let's look at Nvidia's free cash flow and the related price target. In my last Barchart article, I showed that Nvidia's Q1 FCF of $26.125 billion represented an astounding 59.3% of quarterly revenue. That means almost 60% of its sales revenue goes straight into its bank account with no cash outlays on it (even after record-high capex spending). Moreover, I showed that over the last 12 months (LTM), its FCF margin was almost 50% (48.5%). That implies going forward its FCF could rise to a record high. For example, based on analysts' next 12-month (NTM) projections of $225 billion, using a 50% FCF margin free cash flow could exceed $112 billion: $225b x 50% FCF margin = $112.5b FCF How to value NVDA? Let's think about what the market might be projecting. For example, let's assume the market believes Nvidia will make $100 billion in FCF, slightly less than 4 times its Q1 FCF. So, given its market cap today of $3,508 billion, that represents a 2.85% yield: $100b/$3,508 = 0.0285 = 2.850% FCF yield So, using our NTM forecast of $112.5b, its market cap could rise to $3.75 trillion $112.5b / 0.0285 = $3,947 billion NTM mkt cap That represents an upside of 12.5% from today's market cap: $3,947b / $3,508b mkt cap today = 1.125 So, that makes its target price at least 12.5% more: $143.85 x 1.125 = $161.83 However, if Nvidia makes better than 50% FCF margins over the next year, its target price could be much higher. For example, even a 10% higher FCF margin leads to a 24% upside: 0.55 x $225b = $123.75b FCF $123.75b / 0.0285 FCF yield = $4,342 billion mkt cap; $4,342b / $3,508b = 1.2377 = +23.8% upside 1.1238 x $143.85 p/sh = $178 per share The bottom line is that Nvidia's strong FCF and FCF margins will lead to a significantly higher price, between $162 and $178 per share. This coincides with what other analysts are projecting. For example, 66 analysts surveyed by Yahoo! Finance show an average price target of $172.60. Similarly, Barchart's mean survey shows $174.83 per share. In addition, which tracks analysts who have written recently on NVDA stock, has an average price of $179.87 from 40 analysts. My analysis above shows you why these analysts have these higher price targets. But there is no guarantee NVDA will rise to these targets over the next year. So, one way to play this is to sell short out-of-the-money (OTM) puts in nearby expiry periods. In my May 30 Barchart article, I suggest selling short the $128 strike price put expiring July 3 for a 3.125% yield at a 3.72% out-of-the-money (i.e., below the trading price) strike. For example, the midpoint premium was $4.00, so $4.00/$128.00 equals 0.03125. That was for a one-month play (34 days to expiry or DTE). Today, that strike price has a much lower premium of just 39 cents. So, an investor has already made $3.61 (i.e., $4.00-$0.39), or a net 2.82% yield (i.e., $3.61/$128 = 0.028). It makes sense to roll this over and set a new one-month short-put play. That means buying back the short put at 39 cents and reinvesting at a slightly higher strike price one month out. For example, look at the July 25 expiration period (i.e., 34 DTE). It shows that the $137 strike price put options expiring July 25, i.e., 4.7% below Friday's price, have a $3.40 midpoint premium. That means a new short seller of these puts can make a 2.48% yield over the next month (i.e., $3.40/$137.00 = 0.0248). For less risk-averse investors, a 2.70% yield is possible at the $138 strike price(i.e., $3.72/$138.00 = 0.02696). This strike price is just 4% below Friday's close. Moreover, even after rolling the prior trade over, the net yield with the $137 strike put play is still 2.20% (i.e., $3.40-0.39 = $3.01/$137.00 = 0.02197). So, that means over two months, a short seller of these OTM puts will have made 2.82% plus 2.20%, or 5.02% total (2.51% on average for both months). In addition, an investor's breakeven point, even if NVDA falls to $137.00 over the next month, is lower: $137 - $3.40 = $133.60 p/ sh That is -7.125% below Friday's closing price. In other words, this is a good way to set a lower buy-in point for new investors in NVDA stock. For existing investors, it is a way to potentially lower their average cost, as well as produce extra income on their holdings. And don't forget, given the target price of $172.60, the breakeven point presents a potential upside of over 29%: $172.60/$133.60-1 = 1.292 -1 = +29.2% upside The bottom line is that investors can potentially make over a 2% yield over the next month shorting these out-of-the-money (OTM) puts. On the date of publication, Mark R. Hake, CFA did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
25 minutes ago
- Yahoo
3 Signs It's Time To Consider Life Insurance as Part of Your Wealth-Building Strategy
You deserve a bright future. Your belief in yourself and your passion to build a legacy of happiness and success that will echo through generations are powerful motivators. And it's all paying off. You're making more money, and, even more importantly, you're thinking about ways to grow that money into lasting wealth. And that process can require you to think outside the box. Read Next: Check Out: Perhaps you haven't thought of life insurance as a way to build wealth. After all, isn't it there to protect your loved ones in case you pass away — especially suddenly? Well, yes. But it can be much more than that. Used strategically, life insurance can be a powerful wealth-building tool. You just have to know when it's time to add it to your overall financial plan. Some changes to your life are incredibly joyful — like getting married or welcoming a child to the family. Naturally, you want to make sure your loved ones are protected if anything happens to you. A solid life insurance policy can help ensure they can maintain their lifestyle or at least cover essential expenses in your absence. But life insurance can do more than provide a death benefit. With a whole or universal life insurance policy, you can build cash value on a tax-deferred basis and potentially borrow against that cash value to help fund major goals, such as buying a family home or covering your children's college tuition. Explore More: Whether you've dreamed of opening a comic book store since you were a kid or recently launched a handmade soap company, building a business takes serious commitment — and protection. That includes getting adequate life insurance coverage for yourself and any partners. With proper life insurance, you can not only protect against the loss of a major stakeholder; you can also help repay any business debts or taxes. Life insurance can also be used to fund a buy-sell agreement — a legal contract between co-owners that outlines how ownership interests will be transferred in the wake of a major event such as death, disability, or even one owner simply walking away. This kind of planning is essential to ensure business continuity and can prevent disputes among surviving owners or heirs. You don't have to be nearing retirement to start your estate planning in earnest. In fact, the sooner you incorporate estate planning into your wealth strategy, the better positioned you'll be in the long run. If your goal is to become (or you already are) a high-net-worth individual, life insurance can provide critical liquidity to cover estate taxes and help ensure your assets are distributed according to your wishes. Without it, your heirs might be forced to sell real estate, stocks, or other valuable assets quickly, increasing the risk of taking on a loss. A qualified financial advisor can help you find a policy designed to offset federal estate taxes, as well as any state inheritance or estate tax obligations. Life insurance can also help you plan fairly for your heirs. For example, if one child is passionate about taking over the family business or a specific real estate property, you can use a life insurance policy to leave a comparable death benefit to another child, ensuring a more balanced and harmonious estate plan. It's always worth exploring how life insurance might fit into your financial toolbox, but there are certain circumstances that call for a closer look. If you've added dependents, launched a business or started thinking about estate planning, now is the perfect time to incorporate life insurance as part of your wealth-building From GOBankingRates 5 Steps to Take if You Want To Create Generational Wealth 4 Things Your Neighbor Who Retired Early Won't Tell You About Their Financial Plan 4 Things You Should Do if You Want To Retire Early I'm a Certified Financial Planner: 3 Wealth-Transfer Tips I Tell My High-Income Clients This article originally appeared on 3 Signs It's Time To Consider Life Insurance as Part of Your Wealth-Building Strategy Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
37 minutes ago
- Yahoo
Are Investors Undervaluing Tapestry, Inc. (NYSE:TPR) By 31%?
Tapestry's estimated fair value is US$122 based on 2 Stage Free Cash Flow to Equity Tapestry is estimated to be 31% undervalued based on current share price of US$84.33 Our fair value estimate is 37% higher than Tapestry's analyst price target of US$89.08 Today we will run through one way of estimating the intrinsic value of Tapestry, Inc. (NYSE:TPR) by taking the expected future cash flows and discounting them to today's value. This will be done using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF ($, Millions) US$1.15b US$1.20b US$1.33b US$1.43b US$1.52b US$1.60b US$1.68b US$1.74b US$1.81b US$1.87b Growth Rate Estimate Source Analyst x4 Analyst x4 Analyst x2 Est @ 7.68% Est @ 6.26% Est @ 5.26% Est @ 4.56% Est @ 4.08% Est @ 3.74% Est @ 3.50% Present Value ($, Millions) Discounted @ 8.4% US$1.1k US$1.0k US$1.0k US$1.0k US$1.0k US$985 US$950 US$912 US$872 US$832 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$9.7b We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.9%. We discount the terminal cash flows to today's value at a cost of equity of 8.4%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$1.9b× (1 + 2.9%) ÷ (8.4%– 2.9%) = US$35b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$35b÷ ( 1 + 8.4%)10= US$16b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is US$25b. In the final step we divide the equity value by the number of shares outstanding. Relative to the current share price of US$84.3, the company appears quite good value at a 31% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Tapestry as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 8.4%, which is based on a levered beta of 1.272. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. See our latest analysis for Tapestry Strength Debt is well covered by earnings and cashflows. Dividends are covered by earnings and cash flows. Weakness Earnings declined over the past year. Dividend is low compared to the top 25% of dividend payers in the Luxury market. Opportunity Annual earnings are forecast to grow for the next 3 years. Good value based on P/E ratio and estimated fair value. Threat Annual earnings are forecast to grow slower than the American market. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn't be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price sitting below the intrinsic value? For Tapestry, there are three additional factors you should further research: Risks: To that end, you should be aware of the 3 warning signs we've spotted with Tapestry . Management:Have insiders been ramping up their shares to take advantage of the market's sentiment for TPR's future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
