Lionsgate Making a Smart Bet with The Hunger Games
Last week we posted about the necessity of The Hunger Games‘ success for Lionsgate to justify its sequels. And today Fortune is reporting on the film’s potential to be a huge hit and change the game for the studio – analysts say the series could be worth more than $700 million worldwide.
“This is a hit-driven business and even if they have a modest-sized hit, they’ve never had anything remotely close to this before,” says Doug Creutz, a senior research analyst with Cowen & Co. in San Francisco.
While few anticipate a Harry Potter-like whirlwind in terms of merchandising or theme-park rides with The Hunger Games, the studio is patterning more along the lines of Twilight’s take, even working with the same agency, Striker Entertainment, that handled the vampire series to push first into specialty shops and then big box stores after the film is released, Drake explained during the company’s analyst call.
And while you can’t ever really guarantee a winner, some analysts aren’t backing down:
“On the low end this will be a movie over $100 million, and on the high end this could be transformative,” says Matthew Harrigan, a senior analyst with Wunderlich Securities in Denver. “A bullish argument would say that on four movies, after tax, they could make their market cap. You don’t want to assume that because you never know. But this looks like it’s pretty wired in success.”