Summit buy, 'Hunger Games' feed Wall Street optimism
Shares of Lionsgate have soared again on Wall Street’s bullishness over the mini-major’s leveraged buyout of Summit and strong prospects for its “The Hunger Games” franchise.Lionsgate stock closed up 7% on Wednesday, jumping 81¢ to $12.15, with 2.63 million shares changing hands — three times average volume over the past three months — despite a downbeat performance overall by issues on the New York Stock Exchange. The stock had also risen 7% on Friday in the wake of multiple analyst upgrades. The stock is now 41% above its $8.60 price on Jan. 13, the day Lionsgate closed the $412.5 million Summit deal. It’s nearly doubled in price from a year ago, when the issue was held down by Lionsgate’s ongoing battle with investor Carl Icahn. “Mad Money” host Jim Cramer issued an optimistic outlook earlier this week, touting Lionsgate as a stock that could go as high as $15. He said, “You need to get in this stock ahead of the March release date, even as Lionsgate has already run up massively since the beginning of the year, rallying 35% all on the buzz for ‘The Hunger Games.’” “The Hunger Games,” starring Jennifer Lawrence, opens March 23. Lionsgate CEO Jon Feltheimer announced last Friday during an analyst call that the trailer for the fifth “Twilight” film will be attached to “Hunger Games” and that the two franchises will generate “highly visible” cash flows in coming years. Feltheimer also pointed out that total sales of the Suzanne Collins’ book trilogy have grown by 7.5% during the past quarter to 23.5 million. Lionsgate plans to open “Catching Fire,” based on the second “Hunger Games” title, in November 2013.