In what has turned out to be an unusually tragic year in entertainment, the world is mourning the loss of two great actresses — Carrie Fisher, and her mother, Debbie Reynolds. Fisher, who played the iconic role of Princess Leia in the Walt Disney Co. (NYSE:DIS)-owned Star Wars franchise, died on Dec. 27 following complications from a heart attack. Just one day later, Reynolds succumbed to a possible stroke.
The impact of these two big-screen dynamos can’t be stressed enough. Carrie Fisher forever revolutionized storytelling by portraying a character as both feminine and heroic. It shattered gender-role stereotypes and was particularly conspicuous in the 1970s. Fisher would later go on to champion women’s issues in the film industry.
Debbie Reynolds equally had a long and sustained career in entertainment. Prior to her sudden passing, Reynolds was regarded as the last remaining members of Hollywood’s “golden era.” She featured in over 50 movies, and made multiple appearances in popular TV shows.
Undoubtedly, Reynolds’ strengths were inherited by Carrie Fisher, making her all the more indispensable.
Carrie Fisher Pivotal for Disney stock
While that is no doubt a powerful tribute to the late actress, it poses a significant challenge to Disney stock.
Although a relative bargain, DIS still ponied up a hefty price tag of $4 billion for the Star Wars brand. Initial results were extremely encouraging. Star Wars: The Force Awakens — a movie that continues the storyline from the original trilogy — was the “first film ever to hit $900 million in domestic box office receipts,” according to InvestorPlace contributor Tom Taulli.
Overall, the impact for Disney has been overwhelmingly positive. Admittedly, this year — barring some extravagant miracle — will be a disappointment for DIS stock. But between 2012 and 2015, DIS returned an average profit of more than 30%. That’s the type of robust consistency that is difficult to duplicate, especially in an entertainment industry in flux.
However, we’re just beginning to see the first signs of real trouble for Disney stock. Exhibit A is Rogue One: A Star Wars Story.
Excitement brewed early for this prequel spinoff. Though not featuring the primary characters from the original Star Wars, save for brief cameos, the lead was assigned to Felicity Jones. The Oscar-nominated actress is currently one of the hottest commodities in Hollywood, and was expected to carry Rogue to critical and popular success.
No one will dare say that the latest film was a bust for DIS stock. In its opening week, Rogue raked in just under $222 million. But comparatively, Force brought in an astounding $391 million. Even more impressive, the film — which reunited Carrie Fisher and screen partner Harrison Ford — stayed in the top ten at the box office for more than two months.
Unfortunately for Disney stock, I doubt that Rogue will have such staying power.
DIS Stock Staring at Tough Circumstances
I think we have to acknowledge a few, uncomfortable facts. When it comes to Star Wars, the fans have spoken — by and large, they want the original characters. Attempts to popularize new additions to the series — remember Jar Jar Binks? — have been met with failure. There was even an ugly uproar about the racial identity of a Stormtrooper character.
Given that loyalty that often borders on lunacy, Disney stock may face pressure from an asset they once considered unassailable. Keep in mind that despite record-breaking numbers, DIS stock tumbled 18% following the release of Force. Even now, DIS is still underwater against the movie’s debut. Having to rewrite the script or engaging in CGI tricks won’t be good for the bottom line nor shareholder patience.
Ironically, Rogue controversially went the CGI route in bringing back Imperial officer Grand Moff Tarkin, portrayed by the late Peter Cushing. And the Star Wars franchise isn’t the first one to overcome an untimely death to a major star player. Universal Pictures, owned by Comcast Corporation (NASDAQ:CMCSA), was forced into using CGI to finish Paul Walker’s scene for Furious 7. Walker was tragically killed in a car accident in November of 2013.
The critical difference for Star Wars and Disney stock is the dynamic nature of the Princess Leia character. In the original trilogy, Leia is caught in the middle of blaster fights, exploring new planets, and romancing Harrison Ford’s Han Solo. These are incredible nuances that may not come off right, despite using the latest CGI technology.
CGI Not a Cure-All for DIS Stock
For now, DIS stock has a respite. According to Entertainment Tonight, Carrie Fisher wrapped filming for the upcoming Star Wars: Episode VIII. However, that’s far from good news. Depending upon how integrated she was in the film, Episode IX could really be a backbreaker. CGI can fill some empty spaces — it wasn’t meant to carry a pivotal role throughout the entirety of a movie.
Then there’s the question about what to do with the Leia storyline. Following the end of the original trilogy, multiple books were authored that continued the Star Wars saga. Now that DIS owns the franchise, none of those books are considered canon. Therefore, management will have to make some hard decisions in the wake of Fisher’s passing.
It’s quite possible that no matter what, a large group of Star Wars fans will not be happy. People are also being incredibly presumptuous in assuming that the Fisher estate will allow the late actress’ image to be used in Episode IX. If not, that would further necessitate dramatic changes, potentially making the series untenable.
Either way, this is a horrifyingly tragic situation for Disney and legions of Star Wars fans. Although the DIS buyout of the popular brand has resulted in strong contributions, there’s no replacing the original chemistry. Prior efforts have failed, and with the loss of Carrie Fisher, the intergalactic saga’s true potential will never be realized.
As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.