Thursday, November 05, 2015

DreamWorks Moves Up

Now with Add On!

DWA, it turns out, had an excellent Autumn.

Why Did DreamWorks Animation SKG Inc. Stock Spike 16% in October?

The company has worked to diversify its business beyond movies, and that appears to be working.

... DreamWorks has been hit or miss at the box office for its entire existence, which has led the company to ramp up its other businesses. One of those efforts, AwesomenessTV, announced a major deal with global content creator, producer, and distributor Endemol Shine Group to enter "into a strategic partnership to extend the international reach of the AwesomenessTV brand", the company said

Under the multi-year deal, Endemol Shine Group's premium channel network (PCN) Endemol Beyond will launch local language, owned and operated AwesomenessTV channels in key markets outside the U.S., including the UK, France, Germany, Spain, and Brazil. ...

The company reports third quarter results on Nov. 5, [today!] and whether it can hold on to its October gains depends at least somewhat on if it managed to continue to grow its non-movie business. The Endemol deal, however, should help those goals long-term, making DreamWorks Animation stock less of a rollercoaster proposition based on how its latest film is performing. ...

DreamWorks Animation has performed a high-wire act since it's creation two decades ago.

At the beginning, DreamWorks was a creator of animated features, also the possessor of high ambitions for a TV animation division. The TV unit crashed and burned early on, but DWA's feature animation unit, once the company started doing CG animated features exclusively, prospered. One hit followed another, and the money rolled in. But the company was dependent on a business model requiring an endless stream of blockbuster animated features, a difficult feat at the best of times. When it hit the inevitable rough patch (i.e., several movies under-performed) there was trouble there on the concrete banks of the Los Angeles River.

Jeffrey made moves to sell the company (a stand-alone after the separation from live-action DreamWorks) for several years, but potential deals didn't work out. He is now diversifying the corporation, turning it more into what Walt Disney Productions was in the mid-1950s, which is a smart move. The Netflix deal has gotten DWA back into the production of television animation in a major way, and it's purchase of Awesomeness TV is also paying off. If it's next few theatrical features perform well, it should be on much firmer ground.

Add On:


DreamWorks Animation unveiled third-quarter earnings today that showed a 43% revenue increase compared with a year ago thanks to stronger TV and home entertainment results especially with its previous theatrical release Home. The news sent DWA shares soaring as high as 13.8% in post-market trading. ...


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