Marvel Enterprises shareholders weren’t seeing a whole lot of Hulk green Monday, as the comicbook character’s ancestral home saw its stock flop by 11% despite the Universal pic’s muscular opener.
The steep decline in Marvel stock suggests that many traders may already have been anticipating a sizable box office dropoff in subsequent weekends and chose to take profits after a strong two-year run in the stock. Marvel stock fell 11.56% Monday to close at $18.75. A year ago, the shares were trading at around $5. Marvel’s next big film, “Spider-Man 2,” is more than a year away.
Wall Street volatility coincided with Monday-morning quarterbacking in Hollywood. The main question being debated: Can $62 million be considered anything but good news?
Optimists, especially those at U and Marvel, point to the record book: biggest June opening ever; seventh straight Marvel-based pic to open at No. 1; third straight U opening at $50 million-plus; 43% of all weekend tickets sold.
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Skeptics point to the flurry of last-minute P&A spending, the inauspicious Friday-Sunday decline (from roughly $24 million to $21 million to $16 million), and the distinctly male skew of first-weekend crowds.
“It could be a franchise-killer, and that’s what hurts,” noted one veteran studio production exec. “It might end up making money way down the line, but it’s basically a push. The goal was to kick off a franchise.”
Marvel is highly exposed to the media hype surrounding the box office, with a run on the stock in anticipation of a big release and a selloff after opening weekend. A similar pattern was discernible last May during the “Spider-Man” blitz.
And even though Marvel’s gross participation in “The Hulk” is capped, a strong run is essential to generating lucrative sales on merchandise such as videogames and toys.
Equity analysts at Thomas Weisel Partners nonetheless expect “The Hulk” will easily hit the $100 million domestic and $100 million-$150 million international box office grosses needed for the company to reach its capped gross participation percentage (estimated at the lesser of 4%-5% of net after theater splits of around 50% or $5 million).
Spider’s tangled web
Expectations were high for “Hulk,” and it indeed equaled tracking projections. Still, “Hulk” launched in a climate in which everything from “Star Wars” to “Matrix” is critiqued for being no “Spider-Man” at the B.O. Compared with “Spider-Man’s” $114.8 million opening weekend last year and “X2’s” $85.6 million first weekend haul in May, “The Hulk” bow looks a bit subdued.
Perhaps a couple of years ago, it would have been fashionable to withhold judgment on long-term prospects until second-weekend numbers are in. But with “Charlie’s Angels: Full Throttle” arriving Friday, most distrib toppers and B.O. watchers expect “Hulk” to suffer a direct hit.
A week-to-week drop of 50% — hardly an oddity for summer tentpoles — appears likely. Most projections point to a domestic cume in the neighborhood of $150 million, roughly equal to its production cost. Overseas, pic is already showing strength in Asian territories like Hong Kong, where it opened better than “X2.”
Separately on Monday, Marvel announced a licensing deal with X3D Technologies granting X3D exclusive 3-D publishing rights to past and upcoming Marvel Comics comicbooks in CD-ROM formats, to be called Marvel ComX3D.
X3D may republish comics featuring at least 50 Marvel superheroes characters including Spider-Man, X-Men and the Incredible Hulk.
X3D said it will start with six comicbook titles on “mini” CD-ROMs as a first edition release in 3-D.