by Lawrence Meyers | August 5, 2014 11:08 am
I have been a bull on Marvel Studios since the early days, back when it was a standalone company, and it drew down a half-billion dollar credit line from Merrill, collateralized by its character portfolio.
The reason for my bullishness: I had seen the first X-Men movie and realized Marvel was going to treat comics seriously. I also had worked for a few months with a young executive at Richard Donner’s company named Kevin Feige. Nobody knew who he was back then when he started working at Marvel. Everyone knows him now.
And as long as he runs Marvel Studios — which was purchased by Walt Disney (DIS) at what I said was a bargain price of $4 billion — you’d be crazy not to own DIS stock.
Feige and the entire Marvel creative team have moved into Phase II — mining lesser-known characters for feature-film launch under the DIS stock distribution platform.
Marvel has already executed very well on Phase I, in which major characters were not only given their own franchises, but in which they are beginning to be paired off into movies, TV series and grouped into franchises like The Avengers.
That brings us to Guardians of the Galaxy which, on seeing the first trailer, had me worried about this phase of the DIS stock journey. I had faith in Marvel, but I was not loving the trailer.
Still, the storytelling panache that has erupted from Marvel has always been strong, so if they told a good story with the right theme, it could just pull out a winner. Something like Galaxy Quest, which had a terrific story, and audiences flocked to it.
I saw Guardians of the Galaxy. It had a solid story. Good filmmaking. The Marvel base came out in spades, giving it huge box office.
Well done. But what does that tell us as DIS stock holders?
While I might have been pessimistic before, I now believe projects like Ant-Man can succeed and help propel DIS stock. It takes the right tone and the right people to make the films, and again, as long as Feige steers the ship, I’m confident. Thus far, the worst of the Marvel films still are three-star movies. They even hit a home run with Captain America: Winter Soldier, which was better than the first film.
DIS stock knows it has a hot hand, so it is pimping Marvel products everywhere.
You know what else it’s pimping? Star Wars.
Yes, that seminal film from childhood that got me into making movies is now all over Disney’s TV channels. My kids watch those networks, and there are Star Wars crossovers on everything from Phineas and Ferb to … well, everything. Along with new series, as well.
Plus, Star Wars VII is getting the J.J. Abrams treatment, and he hasn’t disappointed me yet. A friend of mine worked the crew and he says the film is great. Then he was promptly killed for speaking about the movie. (Kidding, kidding.)
Star Wars is a gold mine, and they’re about to open another vein. It’s hard not to be excited.
I’ve been harping on these two huge purchases by DIS stock holders, along with the Pixar Studios purchase years ago. There is so much revenue to mine from all of these platforms, and I’m talking about generations worth of product. That alone is reason to buy DIS stock.
Add in the fantastic financials, cash flow, management and diversified entertainment assets, and DIS stock is a forever hold.
If you don’t own it, start now.
As of this writing, you’d better believe Lawrence Meyers owns shares of DIS. He is president of Asymmetrical Media Strategies, a crisis PR firm, and PDL Broker, Inc., which brokers financing, strategic investments and distressed asset purchases between private equity firms and businesses. He also has written two books and blogs about public policy, journalistic integrity, popular culture, and world affairs. Contact him at email@example.com and follow his tweets at @ichabodscranium.
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