DreamWorks (DWA) Hits 52-Week High on New Deals - Analyst Blog
Shares of DreamWorks Animation SKG Inc. DWA scaled 3.13% and touched a 52-week high of $29.75 during Friday’s trading session, finally closing at $28.32. Year to date, shares of the company have gained more than 26%.
Signing of several online programming deals with major companies coupled with the company’s strategy to target the youth with new content TV shows and movies have resulted in the stock price rally.
Despite incurring losses in four out of the last seven releases, the company has two blockbusters – How to Train Your Dragon 2 and the recent release, Home. Both these films have not only made a turnaround in its Film business but have also lent support to the share price movement.
In the first quarter of 2015, DreamWorks reported a 13.1% improvement in revenues as compared with the last-year quarter. Notably, the Feature Film unit reaped profits in the reported quarter of $41 million as opposed to the year-earlier quarter’s loss of $25 million.
In all of the last three quarters, the company surpassed the Zacks Consensus Estimate, with an average beat of 91.72%, including a positive surprise of 48.98% in the previously-concluded quarter.
Meanwhile, DreamWorks is increasingly focusing on its Consumer Product business in order to generate more licensing revenues from its content library. Moreover, a strong movie line-up coupled with the latest online programming deal with Verizon Communication Inc. VZ are likely to boost revenues further.
Stocks to Consider
DreamWorks presently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader sector are The Walt Disney Company DIS and Pearson plc PSO both sporting a Zacks Rank #1 (Strong Buy).
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