First up is Coraline (CORLN), directed by Henry Selick, director of The Nightmare Before Christmas. Most people probably think that was directed by Tim Burton, since it has been marketed for years as "Tim Burton's The Nightmare Before Christmas," but he was the writer and producer, not the director. It has become a cult classic, so a movie made by the same director starts with a boatload of marketability, even if he also directed Monkeybone. But the stock is trading at H$30, which I suspect means that traders are a little wary, although the trend is mostly up. It's clearly not a family movie, but will it really attract everyone who has bought a Jack Skellington action figure? Also, Burton's The Corpse Bride didn't live up to expectations, as I recall. It's in 3D, which is another good marketing gimmick. Strike price is H$10, with the call above H$4, and the call below H$1. It currently has an 84% rating on rottentomatoes.com, so it's very fresh. My prediction is between $13 and $15 million.
Next up is a romantic comedy with the funny but not very inspiring line "He's Just Not That Into You," (HJNTU) based on a non-fiction book of the same title. There are a plethora of stars, including Drew Barrymore, who produced it. I like romantic comedies, but I'm not sure about this one. The rating on rottentomatoes.com is 42%, or exactly half of the current rating of Coraline. I cannot imagine myself seeing this. The stock is trading high; at least H$63 seems high to me, and it's down from a high of H$73. The trend is decidedly mixed - very up and down of late. The options are also sending bad signals. Strike price is H$25, which I think is highly optimistic. Call is treading water at H$0.96, while the put is at $H3.56. We are not optimistic about that $25 million opening. As I think about it, the title is very much a throwaway line that might have been clever a couple of years ago, but now feels stale. And it really, really does NOT sound like a good date movie.
I wasn't clear on why Steve Martin remade Pink Panther, and I'm even less clear on why he made a sequel, Pink Panther 2 (PNKP2), although I assume it's about money. I think the last Steve Martin movie that I liked was Dirty Rotten Scoundrels, but, other than that, he is not making movies that appeal to me. I still have a certain amount of respect for him, and he's a good writer. Maybe he likes making these movies, I'm sure he likes the paychecks. The stock is down from its high of H$54, currently at H$47. HSX set the strike price at H$20, a reasonable move. The call is sinking, to H$1.22, while the put is H$4 and change. Critics are going negative en masse: Rotten Tomatoes gives it a woebegone 7% (although that's out of only 14 reviews). We're just not into this movie, either. REALLY not into it.
Last, and quite possibly least, is Push (PUSH), a science fiction flick about some American kids with special psychic powers hiding out in Hong Kong from the American government. Can you say "B movie?" Good buzz is apparently building, as the trend is good, with a price of H$30, slightly off the high of $H33. Strike price is - whaddyaknow - H$10, right on target. Buzz must be good, the call is closing in on H$4, while the put is well below a buck. The critics hate it. Rotten to the core, it must be, with a score on Rotten Tomatoes of a lowly 18%. You know it's not a good week when that is only the second-worst score. Sounds like all of the entertainment value I will be getting out of this movie will be making some money, and reading the bad reviews. Movies like this are just about critic proof. At least until they open. Then occasionally the audiences agree with the critics, and word of mouth kills it. This weekend, however, we can expect its carefully target demographic to turn out in reasonable numbers.
Update Friday morning: I changed my mind on Push, I am shorting the stock and the call, as well as the put. Why the change of heart? It dropped H$2.00 this morning. How a stock performs on Friday morning is a key indicator of how it will perform over the weekend. A drop of H$1.00-H$1.50 is normal noise, as some traders take their profits. More than that is usually a sign of trouble. Also, I realized that Push has no stars in it. Coraline is down as well, but not as much (about a buck and a half) and the reviews are so good that I am more optimistic.
Update Monday evening: I was mostly right, but wrong about He's Just Not That Into You. Coraline came in slightly above expectations at $16 million, which was nice. HJNTU was a surprise, coming in at $27.5 million, refuting my cynicism. Why, exactly, was I wrong. It must be a guy thing; the audience was 80% female, and, according to Paul Dergarabedian of Media by Numbers,
"Women continue to drive box office in a big way," he said. "And we still continue to, mistakenly, underestimate the power of the female audience."
HSX does lean a little macho. Gotta keep that in mind. On the other hand, that's a good sign for future movies for women and roles for women in the movies. I was right about Pink Panther 2 sinking, it pulled in just $12 million, way, way below the strike price for the options. There is one hopeful sign in that dismal number: hopefully the BO will be so bad that the studio will kill the franchise. It's a good thing I changed my mind on Push, it came in barely under expectations and adjusted down, but only H$1. But I'm glad I changed my positions on the options.
Lessons of the week are: never underestimate a movie chock full of female movie stars who have spent a lot of time on the cover of glossy gossip magazines. Jennifer Aniston apparently still has a huge following, and Drew Barrymore knows how to produce.