‘Fire’ Producer Catching Nothing but Stock Flak

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Lions Gate Entertainment Corp.’s stock continued the beating it’s been taking since the Nov. 22 release of its latest blockbuster film, “The Hunger Games: Catching Fire.”

The movie has been a huge success at the box office, generating $161 million in the United States and Canada its opening weekend and a global total of $673 million as of Dec. 8, according to media intelligence firm Rentrak Corp. Yet Lions Gate’s shares have only fallen since the film’s release, dropping an additional 9 percent for the week ended Dec. 11 to close at $28.29, making it among the biggest decliners on the LABJ Stock Index. (See page 26.)

“There is some concern, albeit I think unfounded, that the film is not going to get consensus ultimate target,” said David Miller, a senior analyst at West L.A. firm B. Riley & Co. who covers media and ad companies.

Projections were that the firm would generate between $750 million and $1 billion. Miller said while $1 billion might be too high an estimate, he feels comfortable with his $900 million estimate.

He said that once the box office for the weekend ending Dec. 15 was tallied, he expects the total gross to be as much as $750 million.

“So then the question becomes, ‘Will it do $850 million or $900 million?’ and we shall see,” he said.

Reaction to the film’s performance might be a piece of a larger market correction to

the company’s stock price, which has been rising for the last year and a half. It is up 80 percent over the past 52 weeks, even with the recent reduction.

“You have to keep in mind that this is a stock that had more than doubled since the first ‘Hunger Games’ film came out in March 2012,” said Marla Backer, an analyst at Irvine firm Ascendiant Capital.

She said the company’s success with the first film in the “Hunger Games” series might have been reflected in the run-up and investors could simply be taking profits.

Miller agreed.

“There is usually a correction after a big theatrical release, which you are (seeing again),” he said. “It’s no cause of worry for us.”

He expects “Catching Fire” to do well internationally, as the first “Hunger Games” film, which grossed $691 million worldwide, and the books on which the series is based had already promoted the franchise name.

“Now you have … (an) installed fan base overseas versus what you had when the first ‘Hunger Games’ came out,” he said.

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