Analyst: DreamWorks Animation Films 'Simply Not Making money with Anywhere Near Historic Norms'

NY - Shares of DreamWorks Animation opened up slightly lower on Wednesday after BTIG analyst Richard Greenfield cut his cost target around the stock and the 2012 earnings estimations, stating lower anticipation for Puss in Boots, amongst other things. He reduced his cost target from $18 to $15.50 and maintained his "sell" rating around the stock. "DWA's key challenge is the fact that their creative output (movies) just isn't making money with anywhere near historic norms," Greenfield authored inside a report."As the development of worldwide marketplaces (especially Russia and China) and three dimensional ticket rates have assisted DWA box office grosses, the rapid decline in your home entertainment market as customers change from purchasing to leasing is way outweighing this area office benefits." Meanwhile, DWA's films have fallen short within the U.S., "with box office outperformance largely occurring in marketplaces where ancillary revenue streams are much less robust compared to the U.S.," Greenfield stated. He stated his decrease in his 2012 earnings estimate to $1.25 per share from $1.54 was "driven by lower box office presumptions for Puss in Boots (three dimensional and Imax three dimensional rates progressively hard for customers to warrant for animated films) and reduced ancillary revenues for Puss in Boots and Madagascar 3." At 10:40am ET, DWA shares exchanged at $18.74, lower 1.9 %. In the last year, the stock has exchanged between $16.50 and $37.74. Email: Georg.Szalai@thr.com Twitter: @georgszalai Related Subjects DreamWorks Animation Madagascar 3 Puss in Boots