Marvel's Blockbuster: Fool by Numbers

Yesterday, Motley Fool Stock Advisor pick Marvel Entertainment (NYSE: MVL  ) released earnings for the third quarter ended Sept. 30, 2007.

  • Third-quarter licensing revenue ballooned to $66 million from $28.3 million the year before, thanks mostly to the success of Spider-Man 3, which Sony (NYSE: SNE  ) released in May.
  • Similar licensing deals are in the works. Lions Gate (NYSE: LGF  ) plans a sequel to 2004's The Punisher for next year, and News Corp.'s (NYSE: NWS  ) 20th Century Fox has slated X-Men Origins: Wolverine for May of 2009.
  • Licensing also improved margins by reducing inventory and production costs for toys. Marvel shed its toy business in 2006 in favor of a deal with Hasbro (NYSE: HAS  ) .

For the most part, CAPS investors like what they see. They give the stock four out of five stars. What's your take? Click here and let us know.

(Figures are in thousands, except per-share data.)

Income Statement Highlights

Q3 2007

Q3 2006

Change

Sales

$123,642

$92,161

34.2%

Net Profit

$36,268

$13,200

174.8%

EPS

$0.45

$0.16

181.3%

Diluted Shares

 80,521

 84,854

(5.1%)

Get back to basics with a look at the income statement.

Margin Checkup

Q3 2007

Q3 2006

Change*

Gross Margin

85.82%

67.79%

18.03

Operating Margin

53.14%

29.98%

23.16

Net Margin

29.33%

14.32%

15.01

* Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q3 2007

Q3 2006

Change

Cash + ST Invest.*

$45,611

$42,307

7.8%

Accounts Rec.

$37,708

$71,235

(47.1%)

Inventory

$10,076

$11,874

(15.1%)

Liabilities

Q3 2007

Q3 2006

Change

Accounts Payable

$1,934

$9,114

(78.8%)

Non-Film Debt

$0

$79,700

(100.0%)

*Includes restricted cash.

The balance sheet reflects the company's health.

Cash Flow Highlights

YTD 2007

YTD 2006

Change

Cash From Ops.

$16,298

$116,513

(86.0%)

Capital Expenditures

$2,372

$14,466

(83.6%)

Free Cash Flow

$13,926

$102,047

(86.4%)

Free cash flow is a Fool's best friend.

Related Foolishness:


Read/Post Comments (0) | Recommend This Article (11)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 539777, ~/Articles/ArticleHandler.aspx, 8/1/2014 10:08:57 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement