Disney
Will Rule the World in 2015 - 25th June 2013
(Credit: NASDAQ)


Profiles
Disney
Marvel
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Hollywood
California

Come
2015, Disneyland will be celebrating its 60th anniversary.
To commemorate the occasion, the Mouse House will
be expanding its theme park empire, with the opening
of a new and massive Shanghai Disneyland and the addition
of a $500-million Avatar-themed section to Walt Disney
World's Animal Kingdom.
But
while the theme parks will surely draw in huge crowds,
it's The Walt Disney Company 's ( DIS ) film division
that is poised to bring home the bacon for the Burbank,
California-based conglomerate in 2015.
Disney's
The Avengers was a massive hit, and its sequel will
clean up at the box office, too.
Disney's
2015 film release schedule is packed with surefire
box office hits on an unprecedented level.
There's
of course the annual feature from Disney's Pixar animation
division. Pixar will release its sixteenth feature,
Inside Out , in June 2015. Though few details have
been released thus far, expect Inside Out to be a
hit - consider, after all, that the average domestic
gross of Pixar films in the last 10 years is an impressive
$268 million. With continuing ticket price inflation
and 3D premiums, Inside Out should be good for a domestic
take of $250 million.
But
while there's still an element of risk that an original
film like Inside Out might bomb, Disney's franchise
properties are all but guaranteed to be record-setting
hits.
Under
the guidance of CEO Robert Iger, Disney successfully
acquired Marvel Entertainment and Lucasfilm, and Iger
will reap the benefits of what he sowed with new Avengers
and Star Wars sequels slated to open in 2015.
Likely
to be the global box office champion of 2015 is Marvel's
The Avengers 2 , the follow-up to 2012's The Avengers
, which shocked industry experts and earned an eye-popping
$623 million domestically and a total of $1.5 billion
worldwide.
While
it'll be incredibly hard to replicate the kind of
lightning-in-a-bottle success of The Avengers , the
sequel should be good for at least $450 million domestically
-- and it has an outside chance of joining Avatar
and Titanic as the only movies to cross $2 billion
worldwide.
Most
movie studios would be lucky to have one $400 million
grosser in a year, but such is the strength of Disney's
2015 slate that it will have two; likely to open mere
weeks after The Avengers 2 is Star Wars: Episode 7
.
Fans
of the series might still be suffering from watching
the prequels, but there's little doubt that they will
still turn up for the new movie. The fact that director
J.J. Abrams, who reinvigorated the Star Trek franchise
previously, is taking over the helm from George Lucas
bodes well for the quality of the movie, too.
Then
there's Finding Dory , the sequel to Finding Nemo
, which will come out at Thanksgiving. Finding Nemo
is arguably the most beloved of all of Pixar's animated
films (which is saying a lot), so Disney can expect
a domestic gross north of $300 million for its sequel.
Finally,
Disney also plans to release the fifth film in its
Pirates of the Caribbean franchise in July 2015. While
this Johnny Depp-driven franchise has lost some of
its luster, the movie should still comfortably cross
$200 million in North America and perform robustly
internationally, where the brand remains strong.
These
five blockbusters, along with big-budget projects
from other movie studios like Lions Gate Entertainment
Corp. 's ( LGF ) The Hunger Games: Mockingjay - Part
2 , Dreamworks Animation Skg Inc's ( DWA ) The Penguins
of Madagascar , and Warner Bros' ( TWX ) possible
Justice League movie, should help propel the domestic
box office past its current annual record of $10.7
billion, set in 2012. That can only be good news for
cinema stocks Regal Entertainment Group ( RGC ), Cinemark
Holdings, Inc. (CNK), and IMAX Corporation (IMAX).
As
for Disney, though the stock has eased off from recent
all-time highs thanks to worries about competition
for ESPN from News Corp's (NWSA) Fox Sports 1, it
still has great potential going forward.
"Disney
is probably the highest-quality media giant based
on its cable-business mix and the irreproducible nature
of its character set," wrote Michael Santoli
of Yahoo Finance .
Sure,
Disney's movie division represented only 14% of the
media giant's revenue in 2012, but the proportion
is bound to rise in 2015. Additionally, Disney's other
divisions, like Parks and Resorts, Consumer Products,
and Media Networks, are bound to reap ancillary revenue
from cross-marketing the Finding Dory , Pirates ,
Avengers , and Star Wars brands.
When
CEO Robert Iger signed his last contract extension
in 2011, he noted that his goal was to increase long-term
value for shareholders.
"[I]
am confident we will continue to do so through the
successful execution of our core strategic priorities:
the creation of high quality, branded content and
experiences, the use of technology, and creating growth
in numerous and exciting international markets,"
he said then, according to Variety.
Given
the likely future success of Disney's movie division
(a Star Wars movie, for example, is scheduled for
release annually starting 2015) and the continued
expansion of its parks business, it's safe to say
Iger has succeeded in what he set out to do. He should
be able to leave Disney with his head held high when
his contract expires in 2015, when The Avengers et
al. will lead Disney's domination of the box office.

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