Lions Gate's (NYSE:LGF-A) latest movie in its Hunger Games series, Catching Fire, has been doing very well in the box office. The film has already collected $300 million in box office sales domestically and about $600 million globally, on track to outperform the first Hunger Games movie on almost every metric. Despite the movie's success, investors are disappointed. Apparently they had higher expectations for the movie.
With the company's stock down about 10%, it suggests Lions Gate's overall corporate results are highly dependent on the movie. Is this really the case? It is. Unlike Walt Disney (NYSE:DIS), which has a very small reliance on its motion pictures segment (10.4% of fiscal 2013 operating income), motion pictures play a central role in the company's results.
In the video below, Fool contributor Daniel Sparks weighs in with the details on why Lions Gate's business is so dependent on the Hunger Games franchise.
Fool contributor Daniel Sparks has no position in any stocks mentioned. The Motley Fool recommends Walt Disney. The Motley Fool owns shares of Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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