No more waiting till June for summer's cinematic tentpole thrill rides. Movie studios' annual box office high season begins on April 29 with Universal's Fast Five.
The film stars Paul Walker and Vin Diesel and is a continuation of the franchise built upon 2001's The Fast and the Furious, which cost just $38 million to produce yet took in more than $200 million in receipts worldwide, Box Office Mojo reports.
Fast Five co-star Dwayne Johnson likely benefits from a beefier production budget, no doubt spent to create the sort of tire-melting, spine-tingling action sequences that helped the previous entry in the series, 2009's Fast and Furious, take in $353 million worldwide. That's Hollywood for you. Create a formula that works and stick with it.
This year, studio executives are sticking with comic book heroes:
Film | Release Date | Studio |
|---|---|---|
Fast Five | April 29 | Universal Pictures |
Thor | May 6 | Marvel Studios |
Priest | May 13 | Sony Pictures |
Pirates of the Caribbean: On Stranger Tides | May 20 | Walt Disney Pictures |
Kung-Fu Panda 2 | May 26 | DreamWorks Animation |
X-Men: First Class | June 3 | 20th Century Fox |
Super 8 | June 10 | Paramount Pictures |
Green Lantern | June 17 | Warner Bros. |
Cars 2 | June 24 | Walt Disney Pictures |
Transformers: Dark of the Moon | July 1 | Paramount Pictures |
Harry Potter and the Deathly Hallows, Part 2 | July 15 | Warner Bros. |
Captain America: The First Avenger | July 22 | Marvel Studios |
Cowboys and Aliens | July 29 | Universal Pictures |
The Smurfs | July 29 | Sony Pictures |
Sources: The Internet Movie Database, Box Office Mojo.
Of this summer's 14 planned tentpole screenings, five are based directly on comics or graphic novels. Another is based on a beloved literary series (i.e., Harry Potter), another on a Hasbro
In other words, Hollywood executives believe preteen boys and geek dads who remember their comic-book-reading days will fight for space in line at the cinema this summer, ready to spend big to be entertained by their heroes.
Can the strategy work? I asked my 11-year-old son what he thought of five movies I'd consider taking him to see: Thor, the new Pirates film, X-Men: First Class, Captain America, and Green Lantern. He showed interest in all of them save for Pirates of the Caribbean, and in the process validated Disney's thesis for buying Marvel Studios.
But of them all, the movie my son most wants to see based on the available trailers is Green Lantern. He isn't the only one. More than 33,000 have weighed in at the film ratings site Rotten Tomatoes and 97% say they plan to see the film, which looks epic:
Under Warner's big top
Color me unsurprised. Not only did Ryan Reynolds' rendition of the emerald hero command big lines at last year's San Diego Comic-Con, but the studio that made the film, Time Warner's
Film | Release Date | Worldwide Gross |
|---|---|---|
| Inception | July 16, 2010 | $825.53 million |
| Harry Potter and the Half-Blood Prince | July 15, 2009 | $933.96 million |
| The Dark Knight | July 18, 2008 | $1,001.92 million |
| Harry Potter and the Order of the Phoenix | July 11, 2007 | $938.21 million |
Source: Box Office Mojo.
To be fair, Disney also has a history of box office outperformance. Pixar Animation, in particular, has proven to be a hit machine, and its latest, Toy Story 3, took in more than $1 billion at the worldwide box office last year.
Viacom's Paramount Studios has also had its share of successes, and Kung Fu Panda 2 looks poised to continue the tradition that includes Titanic, the second-highest grossing film of all time after Avatar, screened by News Corp.'s
Competitor and peer checkup
Metric | Time Warner | Walt Disney | Viacom |
|---|---|---|---|
| CAPS rating (out of 5) | ** | **** | ** |
| Gross margin | 44.4% | 18.6% | 46.8% |
| 5-year profit growth | (3.25%) | 5.80% | 11.00% |
| 5-year est. profit growth | 14.26% | 13.71% | 14.19% |
| Return on capital | 7.0% | 8.7% | Not available |
| Trailing P/E ratio | 15.76 | 18.43 | 31.33 |
Source: Capital IQ. Data current as of April 10.
But you wouldn't know that to look at the stock. Despite all its properties and publishing synergies, Time Warner trades for less than Disney and Viacom. Analysts also expect the company to outperform its peers in terms of earnings growth, resulting in what I believe to be an attractive 0.91 PEG ratio. Mix in a healthy 2.70% dividend yield, and I see a stock that could be a hero for my portfolio. I'll be buying shares when disclosure rules permit.
Do you agree? Disagree? Let me know you would rate Time Warner using the comments box below. You can also recommend other stocks for me to evaluate by sending me an email, or replying to me on Twitter.
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