NEW YORK (TheStreet) -- Lions Gate Entertainment (LGF) fell the most in four years Monday, after weekend box-office sales of The Hunger Games: Catching Fire failed to meet projections from industry analysts.
Shares of Lions Gate were tumbling 9.9% to $30.40 in mid-day trading, the largest drop since June 2009, as investors took profits in a stock that had surged 106% year to date, prior to today.
The Hunger Games sequel took in $161.1 million in box-office receipts, trailing a BoxOffice.com projection of $166 million in sales, according to data compiled by Rentrak (RENT). Nonetheless, Catching Fire did set a new 2-D record for an opening weekend currently held by The Dark Night Rises, part of the Batman franchise held by Time Warner's (TWX). Dark Night's opening totaled $160.9 million.
Time Warner Cable was slipping 0.4% to $132.39 as speculation that the second-largest U.S. pay-TV operator may be a takeover target was mired in doubts that the Federal Communications Commission would approve any such merger with either, Comcast (CMCSA), the country's largest pay-TV operator, or Charter Communications (CHTR).
Nonetheless, Craig Moffett, co-head of research firm MoffettNathanson, said he likes the idea of consolidation among the country's pay-TV providers. One possible deal scenario, Moffett said, is a joint bid whereby Comcast acquires Time Warner cable's New York operations and Charter takes everything else. Such an arrangement would allow Charter to avoid taking on more debt.
"The possibility that the two of them would do something together would make a lot of sense," Moffett said in a phone interview. "The danger is that people have overestimated the magnitude of the synergies."
All this speculation hinges on whether Time Warner Cable would agree to a great unraveling, a point of which its executives have declined comment.
Despite that, the pressures on Time Warner Cable remain. The New York-based cable-TV company reported 306,000 fewer video subscribers at the end of the third-quarter, along with 24,000 fewer broadband customers. That's the first time the company lost ground in both categories. Pay-TV operators are battling to grow revenue in the face of increased competition from Netflix's (NFLX) ever-expanding domination of video-on-demand, and the offerings of relatively new entrants such as AT&T (T).
Time Warner Cable was able to report a profit for the third-quarter, but only because of a rate increase. Time will tell for how long customers will agree to pay even more to the cable guy.
--By Leon Lazaroff and Antoine Gara in New York.