Please ensure Javascript is enabled for purposes of website accessibility

1 Overlooked Entertainment Stock That's Winning Big With "Batman v Superman"

By Eric Volkman - Mar 31, 2016 at 1:29PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

That the DC heroes were a super-hit on opening weekend isn't just a big victory for Time Warner's Warner Bros. studio. A certain entertainment technology company will be a solid winner here too.

It's Hollywood's latest and greatest superhero success story. Batman v Superman: Dawn of Justice obliterated the competition in its opening weekend, ringing up $420 million in worldwide ticket sales.

IMAGE SOURCE: DC COMICS

It also notched a new record opening for the studio that released it, Time Warner's (TWX) Warner Bros., plus a new all-time high for any film ever to debut in March. That's a real turnaround story for the studio, which previously had only one film (How to Be Single) in the list of top 10 grossing films for this year, and was absent from the 2015 top 10 list.

IMAGE SOURCE: DC COMICS

Getting a little lost among the hoopla and handshakes, though, is another publicly traded company that will pocket a nice stack from the success of the movie. Read on to find out which one, or, as they say at the Oscars, "The envelope, please..."

Big screen, big bucks
And our next winner is... IMAX (IMAX -0.59%), the company that specializes in projecting films onto screens that are bigger than your house.

Batman v Superman didn't just break records for Warner Bros. It was also a landmark film for IMAX. It was the highest-grossing IMAX debut ever in the month of March. The movie also notched a new IMAX-specific record for ticket sales in the low season (i.e., outside the peak summer and Christmas periods).

All told, ticket sales in the format for opening weekend amounted to $36 million. This puts Batman v Superman in a solid third place on the company's all-time list. It sits behind a pair of 2015 blockbusters, the Walt Disney (DIS 1.84%) release Star Wars: The Force Awakens (nearly $48 million), and Jurassic World ($44 million) from Comcast's Universal.

Batman v Superman represented a gamble for the huge-screen format, and one that paid off  handsomely. In yet another record, the movie had the widest IMAX release in the company's history. It was shown on 945 screens, nearly hitting maximum capacity. (As of the beginning of this year, there were 1,061 IMAX theaters.)

For a moment, that looked quite risky. Early buzz about the film was not complimentary, and in the wake of the recent success of Deadpool  -- which also had an IMAX release -- there was a chance that audiences might have grown tired of the superhero genre. But neither concern materialized in the end. Audiences flocked to the latest superhero battle, and they were particularly eager to see it unfold on as massive a screen as possible.

Super potential
Batman v Superman's success provides more than a one-time boost in revenue for IMAX. Coming so soon on the heels of Jurassic World and the latest Star Wars (not to mention Deadpool, which rang up $24 million in IMAX ticket sales in its opening weekend), it cements the format as an essential one for studio tentpole releases. If you want your film to go really big, it's got to go IMAX.

That'll be a powerful driver for the company in the future. New IMAX system installations have already been on the rise, growing from 121 in 2014 to 154 last year, and we can anticipate those numbers will continue to grow, not least because the cream of this year's big releases will have IMAX versions -- Disney's new Pixar offering, Finding Dory, for example, as well as fresh superhero efforts Suicide Squad (to be released by Warner Bros.) and X-Men Apocalypse from 21st Century Fox.

It's not just about stories and famous actors in cool costumes -- big-budget feature films rely on spectacle and the "Wow!" factor to bring in the crowds. And what better format to achieve that than IMAX? The movie studios have a strong and useful ally in the company, and that partnership should continue to be lucrative for all concerned moving forward.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

IMAX Corporation Stock Quote
IMAX Corporation
IMAX
$16.79 (-0.59%) $0.10
The Walt Disney Company Stock Quote
The Walt Disney Company
DIS
$96.14 (1.84%) $1.74
Comcast Corporation Stock Quote
Comcast Corporation
CMCSA
$40.29 (2.68%) $1.05
Time Warner Inc. Stock Quote
Time Warner Inc.
TWX

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
316%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/03/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.