Industry Stock Review of 2021 Year to Date
Countless Hollywood stocks lost their momentum in 2020, but are now thriving in 2021’s first three quarters. Due to a boost in advertising revenue and the reopening of the economy after the worst of the Covid-19 pandemic, there have been solid changes, especially for cinemas.
Closing prices just wrapped up, as trading was disclosed at the beginning of October, making it the first day of the final quarter of the year.
For example, the Walt Disney stock, which also happens to be one of the biggest outperformers for 2020, was down just 1 percent year-to-date. It finished at $176.01 at the beginning of October after its big close of 2020, which was at $181.18 and trading well-above the $200 benchmark back in March. The reason behind the recent drop is due to the fact that investors were worried about comments surrounding the drop in streaming growth.
Additionally, questions surrounding streaming have become more apparent for Discovery investors, especially after its most recent deal that was announced in May to merge with AT&T WarnerMedia.
In a report released by Wells Fargo analyst, Steven Cahal, he explains, “Discovery shares have languished since announcing the deal, and we think visibility into the streaming strategy is a key overhang.” And as of the recent close of the market, Discovery’s stock decreased by 16 percent, leaving it at $25.74, while AT&T’s was down at 7.7 percent, resulting in $27.17 close. 
However, other stocks in the entertainment industry are beginning the final period of the year with a positive outlook. Take AMC Network- the stock has held strong above the $30 range since June 1. Now, in October, bullish options activity continued to increase, indicating institutions may believe the stock is about to fly higher. Additionally, Lionsgate, which has been viewed as a potential party in a new deal, has increased 28.5 percent so far, resulting in $14.77.
However, it doesn’t just stop there. In fact, Fox Corp. has also seen a major increase in 2021, especially due to the fact of the increase of sports betting as it continues to flourish. Fox Corp’s shares boosted a whopping 41.5 percent for the year, resulting in a market close at $40.78.
But despite the many substantial runs for the entertainment industry, no one else has seen a rise quite like AMC Theatres. Currently, AMC Theatre’s stock has increased a whopping 1,813 percent ahead of its 2020 closing price, which was initially at $2.12 and now at $38.46 as of the beginning of the 3rd quarter. The fact that it has increased as much as it has is partially due to it becoming a meme stock, which means that it has gone viral and has attracted serious attention from investors, much like what happened to the gaming retailer, GameStop. In addition, many other movie theatres have seen an increase in stocks compared to how hard they were hit during the Covid-19 pandemic. They have grown exponentially year-to-date, despite the Delta variant of the Coronavirus.
And while things are starting to pick back up for theatres, Netflix, the global streaming conglomerate shouldn’t be too worried given that they are still maintaining consistent growth with a recent all-time stock high of 668.24 towards the end of October. Long term strategy, is the reason for the higher returns, currently focusing on global growth of their subscriber base, as well as allocating funds for international content development
Additionally, the entertainment and technology conglomerate, Sony Corp. is surely excited about their boost in stock growth, given the fact that they experienced a 16 percent increase so far in 2021. And according to analyst Doug Creutz from Cowen, he is expecting the media conglomerate to receive a lot of strong support, which is always a good sign in the next coming months.
The media conglomerate, Comcast, has increased 13.3 percent for the year, ending at $57.21 at the beginning of the month; however, has also experienced recent pullback from many pay-TV distributors.
With that being said, the contrast in stock changes for every media conglomerate and theatre is starkly different. Therefore, it is difficult to make plausible predictions, given the changes in the economy. However, despite the everchanging news of Coronavirus and its variants, things are certainly looking a whole lot better.
About Vedette Finance
Tarek Anthony Jabre, CEO and Founder, launched Vedette Finance, a Los Angeles-based film development and finance company, in 2012. Tarek Anthony Jabre‘s goal is to maintain a consistent delivery of high-end product, quality, and financial returns in the entertainment industry. Vedette Finance aims to creatively develop its premium value slate and provide structure to financing in order to produce a diverse range of film projects. To learn more about Vedette Finance, visit www.VedetteFinance.com.