When $100 Million Is a Failure

Where are the headlines, I wonder? After seeing last week's headlines about Madagascar's "disappointing" numbers, I wonder whether DreamWorks Animation (NYSE: DWA  ) will get any love this week. After all, the CGI animal film came back strong to do more business than young Darth Vader himself, and it topped an equally dark nemesis: Adam Sandler, the prison quarterback of Viacom's (NYSE: VIA  ) The Longest Yard.

According to the money counters at Boxofficemojo, Madagascar has now hauled in more than $100 million between its first two weekends. It's no Shrek2, as the headlines pointed out last week, but then, who thought it would be? Very few movies do $95 million in an opening weekend. Shrek is the premium brand at DreamWorks, doing the kind of business that Pixar's (Nasdaq: PIXR  ) films do. But Madagascar's results are on par with Shark Tale, which did $340 million in worldwide box office. If that's a failure, most companies would be glad to take it.

There are a few lessons to heed here. First, all bets are off when you're running your family movie against the final episode of the most popular movie series of all time. Second, Adam Sandler is to Americans as David Hasselhoff is to Germans. There's just no explaining his popularity.

And finally, the movie biz gets increasingly difficult to predict. (Just ask DreamWorks Animation's CEO Jeffrey Katzenberg about those Shrek 2 DVD sales.) Worse yet, America's strange fascination for box-office takes (why the heck do they report this stuff before the pork futures in Moline?) leads to unnecessary navel-gazing and short-term thinking.

That can mean an extra-wild ride for shareholders. It's something that fans of Marvel Enterprises (NYSE: MVL  ) have been enduring for a few years now.

Fools know better than to get too shaken by the freak-out of the week -- or is that weak? But don't let your enthusiasm for the product twist you into making bad buy decisions, either. DreamWorks was priced for perfection from its IPO onward, as if nothing bad could ever happen. Now that Hollywood fickleness has come home to roost, it's time to start thinking about picking up on the bargain.

For related Foolishness:

Pixar and Marvel Enterprises are bothMotley Fool Stock Advisorrecommendations.Seth Jaysonis waiting for Madagascar to hit the budget theaters. At the time of publication, he had positions in no firm mentioned. View his stock holdings and Fool profilehere. Fool rules arehere.


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