DreamWorks' Stock Falls After Disappointing 'Penguins' Box Office

MarketWatch Pulse

Shares of DreamWorks Animation SKG slid 5.6% in premarket trade Monday, after analysts said the company may have to write down "Penguins of Madagascar" after the movie's disappointing opening box-office performance this weekend. The film took in an estimated $25.8 million, according to Box Office Mojo, well below the $32 million estimated by MKM Partners' analyst Eric Handler. This puts the film on track to generate a total U.S. box office of $105 million, said Sterne Agee analyst Vasily Karasyov, or about half his previous forecast of $200 million. That makes it likely that the film will be a writedown, Karasyov said. "Another weak film opening underscores the serious challenges DreamWorks Animation's business model is facing," Karasyov wrote in a note to clients. The stock has dropped 33% so far this year through Friday, compared with a 12% gain in the S&P 500.

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