Disney shares (NYSE:DIS) are down in this afternoon’s trading, mainly because the results for Avatar’s latest release may be in trouble. “Avatar 2: The Way of Water” posted an impressive box office weekend. It cleared $134 million in domestic markets, and reports note the global box office was roughly three times that at $435 million.
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However, that’s not what analysts were expecting. Analysts expected the movie to pull in over $170 million in its opening weekend. The film also broke a record, bringing in the highest December opening figure for IMAX ticket sales of all time with $48.8 million.
There are concerns that “Avatar 2” will lose steam the closer we get to Christmas and may not break the levels Disney wanted to see. The movie cost $460 million to make. Worse, that number doesn’t consider P&A activity. Thus, Disney needs a few more weekends like the opening weekend in order to even recoup its costs.
With “Avatar 2” originally expected to be a box-office masterpiece, this implies significant risk going forward. However, the current calendar of upcoming box-officer releases says that there’s not much else coming out soon. Thus, “Avatar 2” may have its chance after all.
Disney may be having troubles, but it’s still a strong pick by analysts’ reckoning. Analyst consensus calls Disney a Strong Buy, with over four times the number of Buy recommendations as Hold. With a current price target of $120.76, the stock has 39.74% upside potential.