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DreamWorks Animation Stock Sinks to New 52-Week Low

Rise of the Gaurdians Gaurdians in bedroom - H 2012
Paramount Pictures
"Rise of the Guardians"

UPDATED: The poor performance of "Rise of the Guardians" could lead to a $60 million write-down at the studio, one analyst predicts.

Shares of DreamWorks Animation sunk below their 52-week low on Monday as analysts expressed disappointment in the box-office performance of Rise of the Guardians, which has taken in just $48.9 million domestically since opening Nov. 21.

On Monday, analyst Benjamin Mogil cut his rating on the stock from “hold” to “sell,” saying its “fair value” is $14. The stock ended the day's regular trading session down 5 percent at $16.27, which is 8 cents lower than its previous 52-week low.

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Mogil lamented Monday that Guardians is proof that $150 million is “no longer a floor” for domestic box-office results for a DWA 3D movie. “Also clearly no longer the case is the mantra that the lack of competing animated titles will automatically grant a movie clear box-office sailing,” he wrote.

The change to a “sell” rating was triggered by the film’s wide-release international opening weekend of just $40 million, for a $57 million cume to date, Mogil said.

Also on Monday, Cowen analyst Doug Creutz lowered his profit expectations for DWA and slashed his fiscal full-year estimate of 97 cents per share to just 51 cents due to what he expects will be a $60 million write-down attributed to Guardians.  

While Mogil lowered his international box-office estimate for Guardians to $250 million from $275 million, Creutz thinks it will top out at just $200 million.