Earnings Preview for Lions Gate Entertainment
Lions Gate Entertainment (NYSE: LGF) is scheduled to report fourth-quarter fiscal 2011 results after the markets close tomorrow, May 31. Analysts expect this producer and distributor of independent films to announce that per-share earnings came in at $0.18, which compares to a net loss of $0.19 per share in the same period a year ago. That consensus estimate was $0.16 per share 30 days ago. The revenue forecast calls for $400.1 million, which is a decline of 7.1% year-over-year.
The Company
Vancouver, British Columbia-based Lions Gate Entertainment operates in three segments. The Motion Pictures segment develops and produces feature films, as well as acquires and licenses distribution rights. The Television Production segment develops, produces and distributes television series, television movies and nonfiction programming. The Media Networks segment includes the TV Guide Network.
During the three months that ended in March, Lions Gate announced a distribution deal with Studiocanal and Miramax, the first titles in its microbudget films initiative and the extension of its partnership with media superstar Tyler Perry.
Full-Year Expectations
For the full year, analysts anticipate a net loss of $0.61 per share, as well as revenues of $1.6 billion, which is a marginal increase from a year ago. Note though that analysts have overestimated Lions Gate earnings results in the past three quarters; the miss was by two cents per share in the third quarter.
Performance
The handful of analysts that follow Lions Gate have a consensus recommendation to buy the stock, though that could change with a downgrade or two. Analysts' mean price target is $7.93 per share, but shares are trading nearer the 52-week low of $5.69 than the 52-week high of $7.83. The share price is about 8% lower than at the beginning of the year, and the stock has underperformed the movie production industry average and the broader markets in that time.
