Lions Gate Entertainment (LGF) , whose stock tanked in February when the studio said it was "tracking below" its earnings outlook because of poor performance by its last Hunger Games installment, saw another big-budget franchise falter over the weekend.

The Divergent Series: Allegiant, the third film based on author Veronica Ross' young adult series about a group of teens in a post-apocalyptic society, opened with a disappointing $29 million, according to the box office tracking site comScore.

That's a significant drop from the $54.6 million that the first film in the series recorded in 2014 and the $52.3 million opening for the second in 2015. All three films hit theaters in March.

Allegiant cost an estimated $120 million to produce and another $40 million or more to market. Lions Gate cut the final installment of the Divergent series into two films, and will release the final movie in the series, called Ascendant, in June 2017.

Already down 45% from its 12-month high, Lions Gate fell another 3.4% early Monday to $21.86. A falling stock potentially complicates the company's efforts to acquire the premium movies channel Starz  (STRZ) . Lions Gate said in a regulatory filing on Feb. 4 that it had taken a stake in Starz and, along with holdings associated with board member John Malone, "informed (Starz) that it intends to explore whether there is a potentially mutually beneficial combination of the two companies."

The less than scintillating opening of Allegiant comes as Lions Gate tries to launch another film franchise to succeed Twilight and Hunger Games. Gods of Egypt, which opened on Feb. 26 with a meager $14 million in ticket sales, didn't live up to the studio's goals.

Lions Gate executives contended the company cut its production exposure on Gods of Egypt to under $10 million through Australian tax breaks and the selling of foreign rights. The company spent heavily, however, to market the film, including an ad on the Super Bowl pre-game show. It had hoped to make a sequel to launch a new franchise.

Lions Gate generates 75% of its revenues from its film unit, according to its most recent financial report. Earnings from its movie unit dropped from $166.9 million to $49.5 million in its most recent quarter.

"The biggest investor question about Lions Gate is whether the company will be able to find a new blockbuster franchise in time to maintain strong motion picture revenue and earnings growth as the Hunger Games franchise winds down," analyst Joseph Bonner of Argus research wrote before Gods of Egypt's poor opening.

Bonner rates Lions Gate a buy but lowered his EPS estimate to $0.94 from $1.42 and cut his target price from $41 to $34 a share.

 

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.