Painful Opening for "Hostel: Part II"

Who's in more pain: the tortured captives in Hostel: Part II, or the shareholders of Lions Gate Entertainment (NYSE: LGF  ) ?

I ask because Eli Roth's sequel to his ode to onscreen vivisection didn't quite meet up to expectations. In fact, it was a huge bomb -- according to Boxofficemojo.com's current estimates, the horror flick took in about $8.8 million for the three-day domestic weekend and ranked in sixth place. Final numbers are due later, but any change to the statistic probably won't be much help at all.

So what happened? Well, Time Warner's (NYSE: TWX  ) star-packed Ocean's 13 stole a lot of Lions Gate's competitive thunder, taking in an estimated $37 million. In addition, DreamWorks Animation's (NYSE: DWA  ) Shrek the Third, Sony's (NYSE: SNE  ) Surf's Up, and General Electric's (NYSE GE) Knocked Up -- starring Seth Rogen, who used to be in one of the best television shows of all time, Freaks and Geeks -- also kept the torturers at bay.    

That still doesn't explain things to my satisfaction. The movie should have been able to best the previous installment's $19.6 million opening salvo. I mean, this is the summer box office season, after all, and there seemed to be a lot of buzz going into the weekend. The youth should have been on the hunt for their cinematic-bloodshed fix.

The heart of the marketing campaign was typical over-the-top showmanship, with the ending touted as being the most shocking ever in the history of celluloid horror. I haven't seen the film, so I can't vouch as to how true that statement is, but this should have sold more tickets and, instead, failed. I personally thought that a debut gross of $25 million was in the offing, but I turned out to be flat wrong.

Should Lions Gate pull the plug on the Hostel franchise? No; instead, the company should evaluate what went wrong and adjust accordingly, as I still think there is value in this idea. If the film was too dark for the summertime season, then perhaps sticking to the original's paradigm of a January release might be in order. If the film was too dark in general and potential ticket-buyers were scared off this time around, then toning future ones down could work.

Does this mean that I think Lions Gate is no longer a viable investment idea? No, I still like the studio. Anyone who enters this stock with a long-term perspective stands a chance of being well-served by the company's various franchises. Trading around the opening of one specific film is tricky business at best, as no one can predict exactly how any project will ultimately fare once it is released into the wilds of the multiplex. 

You won't be tortured by these Takes:

Time Warner and DreamWorks Animation are proud members of the Motley Fool Stock Advisor recommendation list. Sign up for a free 30-day trial of the service with no obligation whatsoever. The Gardner brothers can help you build a long-term, wealth-building portfolio.

Fool contributor Steven Mallas owns shares of General Electric. As of this writing, he was ranked 6,293 out of 29,896 rated players in the CAPS system. Don't know what CAPS is? Check it out. The Fool has a disclosure policy.


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