Lionsgate (NYSE:LGF): Analyst Speculate On Whose Heads Will Roll

Lionsgate (NYSE:LGF): Analyst Speculate On Whose Heads Will Roll

$LGF

Due to the weak box office of Allegiant, the 3rd picture in the Divergent franchise based on Veronica Roth’s YA novels, sources say Lionsgate (NYSE:LGF) will cut the budget of the 4th and final movie in the series, Ascendant, due to start shooting this Summer.

“The budget for the next one will be reduced,” a production source said. “They have not said by how much,”  but it is expected several millions of dollars will be pared at the very least.

Sources speculate Allegiant’s budget at $110-M. The upcoming picture is still being written and no final budget has yet been determined.

The films have been a disappointment for the studio following the earlier successes of the Twilight and Hunger Games series. Both expanded Hollywood’s awareness of the potential for young-female-driven franchises.

The Divergent Series: Allegiant opened at last weekend to an estimated $29.1-M in North America. That was 44% down from the previous outing, Insurgent, which opened in March 2015. The new movie also is struggling overseas, with a take of $54-M from international theaters and a global total of $83-M.

There has not been quite a YA (young adult) drop-off like this,” said a box-office analyst.

Perhaps Lionsgate film chiefs Rob Friedman and Patrick Wachsberger overplayed their hands in splitting Divergent’s 3 books into 4 films.

Allegiant scored a franchise-low 10% “fresh” rating on Rotten Tomatoes and received a mediocre B CinemaScore, compared to an A- and A for the 1st 2 films.

The performance of the latest installment does not bode well for Ascendant, due out on 9 June 2017. The franchise is not strong enough to compete with the big boys of Summer.

The Divergent series has been fraught with problems, not least the exit of director Schwentke and what sources say was discord during production on Allegiant.

Some recent Lionsgate releases have included 3 major DOA’s:

1. The Last Witch Hunter with Vin Diesel (grossed $140-M worldwide)
2. Mortdecai with Johnny Depp (took $47-M worldwide)
3. Gods of Egypt (earned $128-M worldwide).

Lionsgate’s stock has been drifting for a year as Wall Street consideres its post-Hunger Games future.

On the back of the series’ weak box office, analysts speculate about whose heads will roll at Lionsgate.

Lionsgate declined to comment.

Stay tuned…

HeffX-LTN

Paul Ebeling

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