Walt Disney took a pretty big hit at the box office this weekend, with its 3D space adventure “John Carter.” The movie cost about $250 million to produce, but generated only $30 million domestically.
But investors have already written off the miss, said Tuna Amobi, media analyst for Standard & Poors.
Disney’s shares were up slightly in midafternoon trading.
Amobi even suggests there may be a silver lining to the film.
“It’s a clear signal that Disney is going to refocus its core competence, which is branded films,” he added. “Clearly ‘John Carter’ is not going to be a franchised sequel, as the company had intended.”
Standard & Poors'equity group has a “strong buy” rating on Disney, with a $48 price target, though this bullish stance doesn’t have much to do with the box office.
“It’s a purer content play. The results from the [theme] parks, and the ESPN channel; those fundamentals seem to be rebounding,” said Amobi.
If anything, rising gas prices may be a bigger threat to Disney, but this, too, may not prove burdensome, Amobi said.
“Thus far, it’s not a materially significant risk factor. Theme park traffic, domestically and internationally, are holding up well,” he said.
Disney’s fiscal first-quarter earnings were up because attendance at its parks and resorts rose.
Overall, the Street remains bullish on Disney and is a fan of CEO Robert Iger , who is perhaps one of few that can withstand a Hollywood hit so smoothly.
“This is one of those films — you learn, you take your hits, and you move on, and I expect Disney to do that,” Amobi said.
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Tuna Amobi does not personally own shares in DIS. Disney is an investment banking client of his firm, S&P.