'The Hunger Games': A feast for investors?
(MoneyWatch) "The Hunger Games," the most highly anticipated movie debut since the "Harry Potter" series, opens Friday, and the hype isn't just contained to 14-year-old girls. Kapitall, an online investing platform and website, has come up with The Hunger Games Index, a ranking of public companies that stand to benefit from the movie's success.
The highly acclaimed young-adult book series is lifting the share price of publisher Scholastic (SCHL), just as sales of the Harry Potter books did when they were first published, Kapitall notes. Scholastic enjoyed another boost when the Harry Potter movies hit the big screen
With merchandise tie-ins, licensing deals, and -- naturally -- sequels in the works, "The Hunger Games" sets up a bunch of stocks to benefit from the multi-year movie phenomenon, Kapitall says. Here are the components of their Hunger Games Index:
1. Scholastic (SCHL) -- Operates as a children's publishing, education, and media company primarily in the U.S. Scholastic has the exclusive U.S. publishing rights to "The Hunger Games" book series. Sales of literary series are historically higher with the release of movies.
2. Amazon.com (AMZN) -- Operates as an online retailer in North America and internationally. Similar to Scholastic, the company may report an increase in revenue based on site traffic for the book, as well as book sales.
3. Hasbro (HAS) -- Designs, manufactures, and markets games and toys. Hasbro had been awarded the rights to Harry Potter trading card games, role-playing games, trading cards, candy, and youth electronics. This includes the boardgame Clue -- The Harry Potter addition. Will it also take on "The Hunger Games"?
4. Mattel (MAT) -- Designs, makes, and markets various toys worldwide. The doll company is creating Barbie dolls inspired by "Hunger Game" characters. Mattel also produced the Harry Potter Scene It, plush toys and action figures -- why not do the same with "The Hunger Games?"
5. Lions Gate (LGF) -- Engages in motion-picture production and distribution, television programming and syndication, home entertainment, family entertainment, new channel platforms, and digital distribution activities. Lions Gate is the film studio releasing "The Hunger Games" films. Pre-screenings of the film received generally positive, if not glowing, reviews.
6. IMAX (IMAX) -- Operates as an entertainment technology company worldwide. Many diehard fans will likely be eager to see the film many times, including on an IMAX screen.
But before you plow any cash into this portfolio, be aware that there's absolutely no guarantee these stocks will enjoy sustained, market-beating gains thanks to the new movie franchise. Investing, and business, is more complicated than that, and none of these companies is exactly a one-trick pony. Just as important, the film's long-anticipated premier is hardly a secret to the market -- Lions Gate shares are up 90% this year, in fact, and the Wall Street Journal estimates that the stock price already prices in years of smash-hit sequels. The smart money knows that studio stocks often run up in advance of a hit...and plummet after the release.
Let "The Hunger Games" begin.