Marvel Shares Rocket to New Highs
Shares of
Marvel Entertainment
(MVL)
surged to new 52-week highs Monday after the company once again beat earnings estimates and reported a very strong opening weekend for its
Iron Man
film.
Marvel's first-quarter earnings beat estimates by 15 cents a share, and the company has now surpassed estimates in nine of its last 10 quarters.
Meanwhile,
Iron Man
proved to be a blockbuster at the box office, grossing $100 million in the U.S. in its first weekend. This is the second-best debut ever for a non-sequel film (second only to Marvel's first
Spider-Man
movie), Marvel said in a release.
Marvel Needs 'Iron Man' to Do Some Heavy Lifting |
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In morning trading, Marvel shares rose 7.4%, or $2.23, to $32.48.
The strong
Iron Man
opening could create substantial earnings power at Marvel. This is the
first film Marvel is financing on its own
, which allows for significant operating leverage, since much of a film's costs are fixed. (In the past, the company licensed out its characters to movie studios like
Sony
(SNE) - Get Report
with
Spider-Man
, and lost out on much of the upside.)
The strong showing also lays to rest some of Marvel's critics, who said the company's best days were behind it -- since Marvel has already released three
Spider-Man
movies and three
X-Men
films.
Marvel on Monday announced it will release an
Iron Man
sequel in 2010, along with a movie based on its Thor superhero character.
For its latest quarter, which does not yet include much
Iron Man
profits, Marvel said earnings totaled $45 million, or 58 cents a share, beating the 43-cent target that analysts expected, according to Thomson Financial. A year ago, profit totaled $46.8 million, or 54 cents a share, helped by early contributions from
Spider-Man 3
.
Marvel remains a compelling stock to eye, as the very strong
Iron Man
opening adds to an already attractive operating business.









