NEW YORK (TheStreet) -- Total box office sales are projected to reach $10.9 billion through all of 2013, up from a record $10.8 billion set in 2012. Shares of several movie studios including 21st Century Fox (FOXA), Disney (DIS), Lions Gate (LGF), and Sony (SNE) are rising on Monday on the news.
Shares of 21st Century Fox rose 0.7% to $35.19, Disney shares increased 2.5% to $76.24, Lions Gate gained 3.7% to $31.94 and Sony jumped 1.6% to $17.37 on Monday.
The news comes after several worrying disappointments earlier in 2013. High profile hits and box office surprises in the fourth quarter helped the industry recover from the poor first three quarters.
TheStreet Ratings team rates 21st Century Fox as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate TWENTY-FIRST CENTURY FOX INC (FOXA) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, notable return on equity, reasonable valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 2.8%. Since the same quarter one year prior, revenues rose by 17.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, FOXA's share price has jumped by 40.42%, exceeding the performance of the broader market during that same time frame. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Media industry and the overall market, TWENTY-FIRST CENTURY FOX INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- TWENTY-FIRST CENTURY FOX INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TWENTY-FIRST CENTURY FOX INC increased its bottom line by earning $2.91 versus $0.44 in the prior year. This year, the market expects an improvement in earnings ($3.04 versus $2.91).
- You can view the full analysis from the report here: FOXA Ratings Report