Wall Street Grows Nervous About DreamWorks Animation’s Bet On ‘Guardians’

DAVID LIEBERMAN, Executive Editor
‘Rise Of The Guardians’ Failure Led To DreamWorks Animation “Reset”, 350 Layoffs

The independent studio’s shares are down 4.6% in mid-day trading, and more than 9% since November 2 — their peak over the last 52 weeks — as investors fear that Rise Of The Guardians could fall far short of their expectations. The consensus view among analysts is that the film will generate $58M at domestic box offices over the five-day Thanksgiving holiday, propelling the film to an eventual $170M — with more to come from overseas. Forecasts are all over the lot, though. This morning Susquehanna Financial Group’s Vasily Karasyov projected a $68M five-day domestic box office, headed to $200M. Cowen and Company’s Doug Creutz expects $57M and $160M. And Lazard Capital Markets’ Barton Crockett anticipates $48.4M and $176M. He says the next few days will be a “nail-biter” time for DreamWorks: If Guardians falls short of forecasts then “the movie could be a rare and meaningful money-loser for the studio.” That’s a serious risk. Variety says that tracking reports indicate the film “will hit the $40 million domestic mark over the five-day frame.” Over at the Hollywood Stock Exchange, the value of its virtual shares in Guardians have plummeted more than 25% since mid-October. Just two months ago Janney Capital Markets’ Tony Wible upgraded his DreamWorks recommendation to “neutral” — and less than two weeks later upgraded again to “buy” — in part because of his belief that “the Guardians is setting up to be a major film.” He projected at the time that it would generate $225M at domestic box offices, and $338M abroad, noting that tracking data “spiked on the release of new trailers.”

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