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Marvel Enterprises (MVL)
Investors in Awe of Marvel's Performance
Marvel Entertainment's first-quarter earnings statement packed a powerful punch, beating analysts' estimates and inspiring investors today. The well-known comic book company has grown up along with its audience and has proved that it is a force to be reckoned with. The strong earnings report came along news of a super-powered weekend at the box office with the release of the "Iron Man" movie, which is based on a Marvel character. Marvel is inhaling the upbeat response and has already announced plans to for future projects that will capitalize on its recent successes, but will Marvel's financial future be left in the hands of fickle moviegoers?
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On the earnings front, Marvel Entertainment announced first-quarter profits that beat analyst expectations and raised its full-year earnings and sales forecasts as a result. Earnings actually fell this quarter to $45.2 million, or 58 cents per share, from $46.8 million, or 54 cents per share, in the same period last year. Analysts had forecasted earnings of 43 cents per share, though this estimate excludes one-time items and is also a result of more shares outstanding in the previous year. Revenues declined 26 percent during the first quarter from $151.4 million last year to $112.6 million. Analyst experts had only forecasted $111.7 million, however. Marvel licenses its infamous comic book characters, such as Spider-Man, The Incredible Hulk, and Iron Man, for movies and consumer products worldwide. Licensing partners include Hasbro (HAS: Charts, News, Offers) and Sony (SNE: Charts, News, Offers), two companies who have struggled in recent quarters, partially dragging down sales for Marvel.
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Marvel took today's earnings release as an opportunity to raise its full-year earnings forecast to a range of $104 million to $122 million, or $1.35 to $1.55 per share. Earlier, its profit forecast was between $100 million and $118 million, or $1.30 to $1.50 per share. Marvel also increased its revenue outlook to a range of $370 million to $400 million, boosting it slightly from $360 million to $400 million as earlier predicted. Wall Street earnings estimates come in at $1.58 per share on sales of $490.1 million. Company forecasts, however, do not include revenue or expenses related to TV, film, or media sales of its recent and upcoming box office releases.
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Also topping expectations was the release of "Iron Man," which opened to a global audience of moviegoers this past weekend. The film pulled in $100.7 million during its opening weekend and $104.2 million since its Thursday night debut, making it the second-best premier for a nonsequel in the U.S. ever. "Iron Man's" worldwide total was $201 million, earning $96.7 million in 57 countries since Wednesday. This movie marks an important step in the evolution of the Marvel company as it was the first film to be released by Marvel Studios, which is now financing its own productions after utilizing studio-backing in the past for films like "Spider-Man" and "X-Men."
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Marvel shares are soaring on these reports, reaching a 52-week high of $33.24 in early trading this morning. The company is already planning an Iron Man sequel in April 2010, followed by three more movies by summer 2011. Next up is the June release of "The Incredible Hulk."
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