The Curtain Falls on the Entertainment Industry
Wednesday, we briefly mentioned Disney’s (NYSE: DIS) possible pursuit of Twenty-First Century Fox’s (NASDAQ: FOX) “entertainment assets” as DIS looks to launch a streaming service to “compete with Netflix.”
The first question. Why?
Well, if you’re not a superhero franchise, and you’re doing large format projects like movies, you’re losing money.
The Hollywood Reporter had Summer 2017 “blockbuster season” numbers off 10% vs. 2016.
This is as average ticket prices continue to get more expensive.
DIS knows movies aren’t the future. At-home, unbundled content on demand is.
For further proof, look at theater operator Cinemark Holdings (NYSE: CNK) year-to-date:
CNK has almost 6,000 movie screens all over the Western Hemisphere.
The popcorn business ain’t what it used to be. More proof in the form of Regal Entertainment Group (NYSE: RGC):
Traditional content creators are headed for the exits. Distributors and exhibitors are sinking.
Don’t touch legacy entertainment plays, is the point. If you’re feeling adventurous, the long-range move here is put options.
Point is, you control the future of entertainment. It all comes to your house. You pay for what you want.
Gone are the days of waiting in line to shoulder your way into a crowded theater and struggling to find a seat.
Hollywood knows it. Short Hollywood.
Turning to the markets this morning…
Market Rundown for Fri., November 10
S&P 500 futures are off 7.50 this morning at 2,576.
Oil’s flat at $57.15. Gold goes for $1,284. One Bitcoin will set you back $6,842 this morning.
Is it just us, or was Bitcoin over $7,700 the other day?
Iron stomachs needed in the Bitcoin trade, unless of course you’re “in it for the long term.”
NVIDIA (NASDAQ: NVDA) absolutely blew away earnings yesterday after the market close.
Shares are up $7.78 pre-market this morning at $213.28.
Checking in with NVDA maven Ray Blanco, we asked late yesterday, “What’s your expectation from here?”
Ray’s response: “It’ll be a stepwise climb over days and weeks.”
NVDA’s not done. Still juice in this story.
More on NVDA Monday.
Talk with you again then. Have a great weekend.
For the Rundown,