S&P's 12-month price target is $16. That's about 18% upside in 12 months.
But there's an incredibly long time until LGF is going to see any money---read that PROFITS---from their four "tentpoles" (expected blockbusters): three "Hunger Games" sequels and the last "Twilight." Nov/Dec 2013 will see the FIRST HG sequel and "Ender's Game" (unproven as tentpole film). In that quarter, the marketing expenses will be huge---no it won't just be spent on social media. And management was not clear regarding the PROFITS per episode they would realize if "Anger" is picked up. Not even an estimate or range.
Thus, you're looking at about five to six quarters at least until LGF realizes a (potential) profit from any of these tentpole films. How will the stock price reflect that fact? Throw in a potential big theatrical disappointment and you have very shaky grounds for a "Buy" on this stock, even with $200 million+ in future deleveraging. Good luck.
As you saw prior to THG, stocks rise in anticipation(of the event or news). LGF began its rise months prior to the actual release of THG. This year the anticipation is of the four films you have mentioned. If you wanted to short the time, as events showed, was at the release of THG. We are now approaching the time when the uninterrupted buzz will begin. Twilight has a cult following and the Web will buzz as the next film approaches. Soon after there will be chat on the next Hunger games. Ender's Game has a large cult following in the SF community. I've said before that it is considered by many to be one of the five best SF novels of all times. It will draw attention from multiple directions.
I believe LGF next few films will be discussed endlessly in the media press for the next few month's. This should translate into an ongoing rise in SP over the next few months.
GL to all Longs.
It's a crazy business. Last quarter good profit and promises equalled stock crash.
I know what that was anyway - the manipulators shaking out the sheeple.
This quarter no profits and good promises - equals rising stock price? That would prove craziness.
Well Rheingold I won't ask you your prediction success average.
This company can keep operating this way but it doesn't do anything for shareholders.
I don't appreciate how vague management is with respect to important financial data.
Does anyone know how much LGF would make per episode of "Anger"? A range? No. They throw out a high number. But that's not LGF's slice. It's going to be lower. Much lower. When asked for granularity on a similar issue, they laughed. Until management produces consistent earnings, you will see a stock trade in a relatively narrow range, IMO.
Good luck. I'm on the sidelines for now.
It is clear at this point that you are short. You are up against a unanimous analyst "buy" consensus. You are also up against retail investors who will react to news explosion on Hunger Games release.
Save yourself some money. Better stocks to short.