Disney Shares Rise Despite Lone Ranger FlopMonday, July 8, 2013
Shares of Walt Disney Co. moved higher Monday despite the high-profile flop of the studio’s latest film, “The Lone Ranger.”
The film grossed just $49 million over the five-day July 4 holiday weekend despite starring Johnny Depp, being produced by Jerry Bruckheimer and being directed by Gore Verbinski – all names associated with Disney’s "Pirates of the Caribbean" franchise. The Hollywood Reporter estimated it had a production budget of $250 million, plus marketing expenses of $175 million.
Barton Crockett, an analyst at Lazard Capital, expects the film will require a $190 million write-down. David Miller, an analyst at B. Riley &Co., predicted a lower write-down of $100 million and believes investors will look past the film. He maintained an “outperform” rating on the stock.
Since the beginning of the year, Disney shares have moved higher consistently based on the performance of the “Avengers” and “Iron Man 3” films.
Disney shares lost 67 cents in morning trading Friday after the release of initial disappointing box office figures, but regained ground to lose just a penny, closing at $62.82. Shares gained 86 cents, or 1.4 percent, on Monday to close at $64.68 on the New York Stock Exchange.