Tuesday, June 04, 2013

Happy Days

DreamWorks shares, they are moving in a northerly direction.

DreamWorks Animation stock has made an impressive run up the charts in 2013, boasting a year-to-date gain of about 33%, and outpacing the broader S&P 500 Index (and SPY) by more than 20 percentage points during the past three months. What’s more, the stock gapped notably higher at the beginning of last month after topping analysts’ first-quarter earnings projections, and went on to tag a year-to-date high of $22.26 on May 14.

Meanwhile, DreamWorks shares continue to trade above support at their 10-week moving average ...

DreamWorks has had good fortune with The Croods, the studio's latest entry in the animated feature box office sweepstakes, but it has some of the same issues as before. Though its branching out into television and amusement parks, it still needs every ninety-minute cartoon to be a hit. Otherwise, there are complications.

DWA has a couple of different ways it can go. The company can push to become more conglomerate-like, where it gets into doing live-action features of hybrids. Or it can get swallowed up by one of the existing entertainment conglomerates. My bet is that News Corp. gulps down DreamWorks Animation whole before too many more years pass.

Naturally enough, I could be totally wrong.


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