Can a Dragon Save DreamWorks?

DreamWorks (NASDAQ: DWA  )  has an expensive habit that's burning through its income statement. In each of the past three years, the animated-film developer has had to take a multimillion-dollar writedown on one of its movie releases. In 2012 it was Rise of the Guardians, which cleaved $87 million out of that year's earnings after disappointing at the box office. Turbo played that part last year, sapping $14 million from profits. And this year we already have Mr. Peabody & Sherman, which caused a $60 million hit to last quarter's results.

In the following video, Fool contributor Demitrios Kalogeropoulos puts those disappointments into perspective, noting that at least DreamWorks' management understands that things can't continue like this for long. The company is aiming to turn things around by focusing on telling more compelling stories, marketing those films better, and then timing their releases better so that they don't get lost in the crowd of entertainment options available every weekend.

Next month's release of How to Train Your Dragon 2 covers those three bases well, Demitrios says, and the movie should do well in the box office. But investors will want to see DreamWorks string together a few more hits before they can have confidence that the company is back on track in its film business.

Cable companies need saving too
People will always find room in their budgets for movies. But cable? Not so much. You know that industry's going away. But do you know how to profit? There's $2.2 trillion out there to be had. Currently, cable grabs a big piece of it. That won't last. And when cable falters, three companies are poised to benefit. Click here for their names. Hint: They're not Netflix, Google, and Apple

 


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

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.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2954293, ~/Articles/ArticleHandler.aspx, 8/29/2014 2:07:03 PM

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