So far, the new Call of Duty is twice the game as Halo 4.
Activision Blizzard (NASDAQ: ATVI) said Black Ops II, the latest in its Call of Duty series, booked $500 million in first-day sales worldwide. Halo 4's $220 million first-day haul for publisher Microsoft (MSFT 0.21%) looks small by comparison.
To be fair, Halo 4 was only released to Xbox owners, while Black Ops II was released to every major console, including the Xbox, Sony's (NYSE: SNE) PlayStation 3, and Nintendo's (NASDAQOTH: NTDOY) new Wii U console. Both games also broke records for their respective franchises.
Color me unsurprised: video game releases are now routinely bigger than Hollywood's biggest bows. Take Marvel's The Avengers, which, according to Box Office Mojo, earned a combined $392.5 million during its opening weekends here and overseas for studio parent Walt Disney (DIS 0.20%), resulting in one of the biggest box offices of all time. Black Ops II earned at least $100 million more than that on day one, big enough to support billions in future revenue via successive releases or even a movie franchise of its own.
Think about it. We've already seen Hasbro (NASDAQ: HAS) transform well-known toys into movie characters, while Disney has already earned a tidy sum on the video game themed animated feature Wreck-It Ralph. Video games are big money.
So why is Activision only trading 5% higher on this market victory for Call of Duty: Black Ops II? Why isn't the stock selling at a premium to Disney? Both companies trade for close to 15 times trailing earnings.
The answer, I think, is that stability is more valuable than a short-term win. Disney is well-diversified, blessed with great brands, and poised to take advantage of known catalysts. Activision may be a good business, but Disney is a Tier 1 stock.
