HSX: Week of March 27, 2009

Once upon a time there was an organization called the World Wrestling Federation, which used the acronym WWF. But there was also an organization called the World Wildlife Fund, which also used the acronym WWF. The advocates for warm and fuzzy animals sued the hyper-aggressive bizarre guys in spandex for the rights to the acronym, and won. So the WWF in spandex became the WWE, which stands for World Wrestling Entertainment or something. Whatever it is, it's releasing a movie this week called - appropriately enough - 12 rounds, starring some guy named John Cena (12RDS). I've heard the name, couldn't attach it to a face. As for the movie, it is what it is. The stock is trending up nicely, currently at H$19, just barely off its high. The strike price is H$5, about what I expect. The call is trading at H$4, while the put is below a single dollar. All signs point to an opening weekend between $7 and $9 million.
Stock: Long
Call: Long
Put: Short

Moving just slightly up the scale of artistic credibilty, we encounter The Haunting In Connecticut (HAUCT). No, it's not about Chris Dodd's too-cozy relationships with investment bankers, it's about a house with issues. The stock doesn't seem to have too many, moving steadily up to perch at H$35. Strike price is H$10, very expected, with the call at H$4 and the put headed down to where it's expected, to the nether regions, but not quite there yet, hanging in at a buck and a half. Not a great week for the Nutmeg State, although I think the potential recruiting mini-scandal at UCONN doesn't sound serious. Go Huskies!
Stock: Long
Call: Long
Put: Short

Saving the best, hopefully, for last, we have Monsters vs. Aliens, the latest in animated absurdity from DreamWorks. They ain't Pixar, yet, but they're trying really hard to get there. I like the trailer, and I, for one, could really use some comic relief right about now. I have a feeling the rest of the country probably feels the same. One lesson they seemed to have learned: with animation, sell the movie, not the stars. This one features the voices of Seth Rogen, Reese Witherspoon, and Paul Rudd, three hot names, but they are nowhere in the advertising. Good call, Mr. Katzenberg. People don't go to see animated movies because of the voices.
The stock (MVSA)is suffering from overripe overhyping; it's been drifting down from a high of H$161 to H$142. The strike price is H$55, which looks a tad optimistic, but the call is floating nice and high above H$5. The put, however, is also looking up, at H$3+. Mixed signals all the way around. One positive is that's it's being released in 3D, which should drive some traffic, and boost the BO; 3D ticket prices tend to be higher. This is one to keep an eye on. I'm going mostly on faith and a need for comic relief.
Stock: Long
Call: Long:
Put: Short

Note: I am posting this on Wednesday afternoon, because I am going to Disneyland tomorrow, and might not be able to update this tomorrow night. I'm not sure that screencounts and critics' ratings would be accurate tonight, but I will try to check those tomorrow and post whatever I can.

Update Sunday afternoon: I didn't have a chance to check the screencounts or critics' ratings, but I don't think it mattered. I was mostly right. 12 Rounds came in slightly below expectations at $5.3 million, which beat the strike price, but was way below the call. So I got the stock and the call wrong, but the put right. The Haunting in Connecticut was a nice surprise, hauling in $23 million, WAY above predictions, and adjusting up by H$26. Nailed that one. Looks like Monsters v. Aliens will be a hit, possibly a monster one, as it brought in $58 million, and adjusted up H$8. That was slightly below what the call was predicting, but that's pretty close, and if you bought the call at the IPO price of H$2, you made money. So I am going to give myself credit for 7 of 9 this weekend (the wrong ones being the stock and the call for 12RDS).