Midyear Stock Ticker: Disney Now Valued As World's Largest Media Company
Boom! Hollywood congloms (except Comcast) fare better than the S&P 500 during the first half of 2013.
This story first appeared in the July 19 issue of The Hollywood Reporter magazine.
Despite a rough patch in late June, the first six months of 2013 have been very good to Hollywood stocks.
At about the halfway mark of the year, big media companies -- including long-suffering Sony -- all have experienced gains. And all but one of the seven major entertainment conglomerates have outpaced the 10.3 percent rise notched by the S&P 500 in the time period. Many smaller entertainment stocks have trounced that benchmark, with Lionsgate up 66.4 percent to $27.29 and perennial yo-yo DreamWorks Animation up 46.6 percent thanks to the success of The Croods.
Netflix, which premiered the original series House of Cards, Hemlock Grove and Arrested Development in the first half of 2013, was rewarded with a huge 132.9 percent stock increase to $215.60 (with a market cap of $12.1 billion). A weakness in cable has made Comcast a laggard among conglomerates, though it has bested Time Warner Cable, up 4.1 percent, and Cablevision Systems, up 1 percent.
Still, a meager-by-comparison gain for Comcast has allowed Disney to overtake it -- for now, at least -- as the most valuable media company. Of course, that designation doesn't take into account powerhouse new-media companies such as Apple and Google, which sport market capitalizations of $377.84 billion and $288.57 billion, respectively. Still, analysts believe Hollywood stocks are poised for even more growth through the rest of the year.
"We continue to see content media as an attractive business," writes Davenport & Co. analyst Michael Morris, "benefiting from new entrants and international expansion.