This weekend is actually a bit of a lull in the summer movie season, by which I mean that there aren't any blockbusters opening. Two comedies, no action adventure. No explosions, at least none that I have seen in the trailers.
It's been a while since we've had a good romantic comedy, and one of the reigning queens of the genre, Sandra Bullock, is in the role of a demanding boss in The Proposal (PROSL). Good romantic comedies put their characters in two diametrically opposed roles. This is one reason I like romantic comedies that have one of the characters playing a criminal; that's a good obstacle to overcome. Trying to get along with a horrible boss is a problem that most people can identify with. The stock is at H$71, just slightly off its high, but the trend has been very steadily upwards. Strike price is H$25, with the call at H$4 and change, and the put below a buck. It's at 53% on rottentomatoes.com, which is a little disappointing but not surprising. Unless it bombs, I am interested. It also has basically no competition. $25 million sounds about right. $30 million may be optimistic, but I'm going to go long on the call because of the danger of shorting with lots of upside potential.
Jack Black is usually good for a few laughs, if you like his sense of humor. He's playing the mentor - of sorts - to Michael Cera in Year One (YEAR1). But his schtick also seems to be wearing thin. Maybe it's me. I like him, but I thot he was horribly miscast as Kate Winslet's love interest in The Holiday (particularly when the opposite pairing was Cameron Diaz and Jude Law). This is clearly his kind of vehicle, but it also looks like it could be basically a string of one-liners. The director, Harold Ramis, has a rather good track record (Groundhog Day), but he's also not a young man anymore, so I'm not sure how well he's going to do making a movie for guys who have clear and recent memories of puberty. Stock is at H$52, and has been dropping steadily for a while. That's down from a high of H$77. So much for the hype. The trailer has some laughs, but there's always a danger that those are the only laughs in the movie. The strike price is H$25, which is just flat-out absurd. The call is H$1.09, but that's down from a high of H$3.95. Which means that, in the last week, someone thot that this was going to do $30 million this weekend, while the stock was predicting a $20 million opening weekend. Somebody is going to lose money there. The put is H$4.73, and even that might be a bargain. Rottentomatoes.com has it at 36%, and the positive reviews read like they are straining not to be too harsh. I think this movie will be lucky to do $15 million, let alone $20 million. I am shorting the call, because there is basically zero potential for any surprises on the upside.
Update Monday night: $30 million wasn't optimistic for PROSL, it was on the wasn't optimistic enough. A $34 million opening weekend will win any girl's heart, and any guy's. Way to go, Ms. Bullock, and welcome to the A list, Mr. Reynolds. Or at least the B+ list!
I was a little too pessimistic for Jack Black and Michael Cera, who managed to open just slightly above the halted price, so YEAR1 moved up a bit on the adjust. It cleared $20 million. So I was a little wrong on that one, but right about everything else. 5 out of 6 ain't bad.
Technical note: HSX launches v4 on Wednesday, which should be exciting. Hopefully this time they will get it right.