IE 11 is not supported. For an optimal experience visit our site on another browser.

DreamWorks Animation shares drop on poor 4Q

Shares of DreamWorks Animation SKG Inc. fell to a new year low Wednesday after the film company reported fourth-quarter earnings below Wall Street expectations.
/ Source: The Associated Press

Shares of DreamWorks Animation SKG Inc. fell to a new year low Wednesday after the film company reported fourth-quarter earnings below Wall Street expectations.

Shares dropped $2.14, or 10.8 percent, to close at $17.62. The stock earlier traded as low as $17.32. It has ranged from $18.87 to $32.73 over the past year.

The company said its net profit for the quarter fell 45 percent to $51.6 million, or 58 cents per share, as revenue fell 31 percent to $199.8 million.

Analysts polled by Thomson Reuters had expected a profit of 60 cents per share on $232.5 million in revenue.

The miss was driven by the lower-than-expected performance of "Kung Fu Panda" which was released to the home video market.

Wedbush Morgan Securities analyst Michael Pachter cut his 12-month price target on the shares to $25 from $27, but said he expected the company's most recent titles, including "Madagascar: Escape 2 Africa," to come through in the end.

"We believe that many of these 'lost' revenues will simply be captured in the current year," Pachter said in a research note.

He also said he expects the company to resume its repurchase of shares now that they are below $20.