Walt Disney Co. (DIS) released its newest Marvel Cinematic Universe (MCU) entry “Captain Marvel” over the weekend, and the female-led superhero film demolished analysts’ box-office expectations. It brought in more than $153 million in domestic ticket sales, beating the initial $125 million estimate. Worldwide, the movie has grossed about $455 million.
However, Disney investors hardly responded to the film’s success on Monday. Shares of DIS climbed a modest 0.8% from $113.81 to $114.75.
The success of “Captain Marvel” was not unexpected, mainly because Disney is now known for releasing hit franchise movie after hit franchise movie. But with all of these major box-office hauls, investors rightfully speculate just how much they historically translate into its stock’s short-term movement. Billions of dollars in ticket receipts naturally show up in the bottom line every quarter, but it’s worth examining the way market participants react to the firm’s seemingly endless ascent to global cinematic dominance, which will become even more prevalent once Disney closes its acquisition of Twenty-First Century Fox Inc. (FOXA).
With that in mind, let’s analyze Disney’s highest-grossing film releases and how DIS stock performed around their high-profile opening weekends…
Star Wars: The Last Jedi
The second film in the Star Wars sequel trilogy is Disney’s fifth-highest grossing movie in North America, bringing in $620.2 million in the U.S. and Canada during its theatrical run. The movie also earned $712.6 million in other territories for a total worldwide gross of $1.33 billion, the 11th-largest of all time.
In its first weekend of Dec. 15 to Dec. 17, 2017, “The Last Jedi” grossed $450.8 million worldwide to become the fifth-biggest opening ever. DIS stock traded largely flat the following Monday, closing at $111.03 per share for a negligible 0.2% loss from the Dec. 15 session. But shares trended lower from there for a weekly loss of 2.3% between Dec. 15 and Dec. 22. The decline likely stemmed from the announcement of the Disney-Fox deal, as Disney’s massive $52.4 billion offer (which was eventually boosted to more than $71 billion) led investors to sell on an anticipated drop in quarterly earnings.
Marvel’s The Avengers
The culmination of the MCU up until that point resulted in being the first Marvel production to bring in $1 billion in ticket sales. Overall, “Marvel’s The Avengers” earned $623 million in North America and $895.5 million across the rest of the world for a total global gross of $1.52 billion. It’s Disney’s fourth-highest grossing film and the seventh-highest grossing ever globally.
It hauled in $207 million on its U.S. opening weekend of May 4 to May 6, 2012. During the following trading session on Monday, May 7, shares of Disney posted a strong gain of 2.1% from $42.93 to $43.82. Investors rallied behind the stock on hopes that the movie would make up for “John Carter,” Disney’s enormous box-office bomb that lost the studio roughly $200 million.
Avengers: Infinity War
Disney’s third-highest grossing movie is “Avengers: Infinity War,” which took in $678.8 million in the U.S. and Canada during its theatrical run. It made $2.05 billion worldwide to become the fourth-highest grossing film of all time. Even more impressive was how “Avengers: Infinity War” surpassed the $1 billion mark at the box office in 11 days, beating “Star Wars: The Force Awakens” as the fastest movie to reach $1 billion in global receipts.
Its worldwide opening weekend of $640.5 million between April 27 and April 29, 2018 stands as the biggest opening ever. As for its influence on the stock price that following Monday, April 30, DIS climbed just over 1% from $99.23 on April 27 to $100.33. However, shares reached peak gains of 2% that session as investors realized Disney would reap a big return on its even bigger investment. The production of “Avengers: Infinity War” cost about $320 million, accounting for over 5% of Disney’s Studio Entertainment costs in 2017 and making the movie one of the most expensive ever made.
Black Panther
The culturally significant “Black Panther” ran away at the box office to become Disney’s second-highest grossing film ever. It raked in $700.1 million in North American box-office receipts, solidifying its status as the highest-grossing solo superhero film ever and third-highest earning film ever in the U.S. and Canada. On the global stage, “Black Panther” made $1.35 billion and became ninth-highest grossing movie ever.
Over its four-day Presidents’ Day weekend from Feb. 16 to Feb. 19, 2018, the movie raked in $242.1 million in box-office revenue, handily making it the best Presidents’ Day weekend opening. When markets reopened on Tuesday, Feb. 20, shares of DIS shot up to highs of $107.57 before ultimately closing 0.5% lower at $105.98. However, shares eventually posted a 0.7% weekly gain from $106.53 on Feb. 16 to $107.25 on Feb. 23.
Star Wars: The Force Awakens
The widely anticipated and heavily marketed return to the Star Wars universe demolished numerous box-office records with a global haul of $2.1 billion and North American gross of $936.7 million. Not only did it become the highest-grossing film in the franchise but also the highest-grossing film in North American history and third-highest grossing film of all time, behind “Avatar” and “Titanic.”
“The Force Awakens” earned $248 million on its opening weekend from Dec. 18 to Dec. 20, 2015, with $119.1 million of that coming on Dec. 18 alone. Despite the historic haul, Disney stock tumbled about 1% from the Dec. 18 close of $107.72 per share to $106.59 on Dec. 21. The overarching sentiment at the time concerned Disney’s declining cable revenue, particularly from ESPN, which lost about 7 million subscribers between 2013 and 2015. That translates into $650 million less in cable revenue.
Conclusion
Accounting for all five movies listed, the average daily gain for the session immediately following the opening weekend comes out to 0.28%. While a multitude of company-specific factors must be considered when examining those daily performances, it’s clear that Disney’s box-office dominance has come to be expected by investors at this point, leaving them little incentive to buy more shares or take their money off the table.