Another "Twilight" movie released this weekend meant another big box-office haul for the teen-targeted vampire and werewolf series, but neither that nor a sizable rally in the market overall were doing much good for the film's distributor, Lions Gate Entertainment (LGF).
Year-to-date, investors have gotten an 82.7% gain in Lions Gate, according to Yahoo! Finance data, and the stock ended at an all-time high of $16.68 on Nov. 9, FactSet shows. Since then, investors have adopted the stance of pocketing their profits, which they did ahead of the "Twilight" release and continued after the movie's initial numbers. From the peak close earlier this month, the shares have shed 7.7%. Lions Gate was recently down 1% at $15.39, while the major averages were up at least 1.3%.
For Lions Gate, the release of the last new chapter planned for the "Twilight" line, "The Twilight Saga: Breaking Dawn, Part 2" is actually the first in the set it has managed. In January, it bought Summit Entertainment, the company behind the first four "Twilight" movies, and with it, what's been a cash machine.
Of course, the biggest audience for "Twilight," female teenagers, is interested less in stocks and ticket revenue than in Bella and Edward and in the real-life relationship of stars Kristen Stewart and Robert Pattinson. Their devotion to the cause gave "Breaking Dawn, Part 2" a domestic tally over the weekend of $141.3 million, data on Hollywood.com show, easily surpassing the newest James Bond movie "Skyfall," which opened a week ago and came in at No. 2 this week. Globally, "Twilight" pulled in $340.9 million since Friday, Lions Gate said in a press release.
To the casual observer, the total that the latest "Twilight" racked up will appear astronomical, but it's par for the course. In total, the series has gotten movie-goers to part with roughly $2.5 billion at the theater since the first "Twilight" came out in November 2008, making it one of the most successful movie runs ever.
The strongest traditionally measured weekend for the five "Twilight" movies was "New Moon," released in November 2009. It outpaced "Breaking Dawn, Part 2" by about $1.5 million. "Eclipse" opened before the Independence Day holiday in 2010 and had a six-day opening "weekend" total of $175 million. Lions Gate clearly will hope that the popularity of "Twilight" will extend well into the future since it now owns the rights to the library.
Lions Gate said that with a major push from "Twilight" and "The Hunger Games," another title aimed at young people that was released earlier this year, it has exceeded $1 billion in domestic ticket sales in 2012. It expects to bring in more than $2 billion globally. "The Hunger Games" had $408 million in gross domestic ticket sales and almost $700 million all told, Lions Gate says.
Around the March 23 release of "The Hunger Games," Lions Gate's stock exhibited similar behavior to what's happened in the last few days in the run-up to "Twilight." From a close of $13.21 on March 16, the shares went to $15.68 on March 21 -- an 18.6% gain. But a week later, they had fallen back to $13.59. In other words, if you plan to trade around movie releases, it might be best not to overstay your welcome. Again though, the longer term this year has been good to Lions Gate shareholders who weren't only looking for a quick bounce and exit.
Lions Gate also has TV shows, including "Mad Men," "Weeds" and "Nurse Jackie," on its roster, but should you want to mark your calendars around the next teen/young adult movies from Lions Gate, you've got three more "Hunger Games" to look forward to. You've also got a while to wait. The next movie in that series, "Catching Fire," is set for release in November 2013. "Mockingjay, Part 1" is due a year after that and "Mockingjay, Part 2" in November 2015.
For the time being, if you like being in line with Wall Street's thinking, or if you prefer the contrarian approach, know that the nine analyst ratings available for Lions Gate on FactSet are uniformly positive -- all are either buy or overweight -- and the average price target is $19.50.