Pixar Animation Studios Inc. shares rallied to their highest-ever level on Monday, May 23, 2005, lifted by positive broker's comments about anticipated higher box office sales and expectations of a rise in the number of feature films produced.
Shares of Pixar jumped $2.29, or 4.5%, to $52.97 in afternoon trading on the Nasdaq stock market. At the current price, the stock is up about 23% so far this year. In April, Pixar approved a 2-for-1 stock split.
Prudential Equity Group raised its recommendation on Pixar's stock to "Overweight" from "Neutral." In a note to clients, Prudential said it decided to upgrade the stock based on expectations of higher ticket prices and ticket sales projections.
The brokerage also said it believes that Pixar will ramp up its production schedule to more than one film per year, starting in 2009. "Specifically, we've assumed that starting in that year, Pixar will release two films per year, every other year," Prudential said in its note, in which it also boosted its stock target price to $75 from $40. The higher price target is regardless of whether or not Pixar strikes a deal with Walt Disney Co., the brokerage added.
Pixars 10-year distribution deal with Disney expires with the release of John Lasseters CARS on June 9, 2006. But there are indications that an extension of the agreement might be possible with incoming Disney ceo Robert Iger replacing Michael Eisner.
Emeryville-California-based Pixar Animation Studios (www.pixar.com) combines creative and technical artistry to create original stories in the medium of computer animation. Pixar has created six of the most successful and beloved animated films of all time: TOY STORY, A BUG'S LIFE, TOY STORY 2, MONSTERS, INC., FINDING NEMO and THE INCREDIBLES. Pixar has won 18 Academy Awards and its six films have grossed more than $3.2 billion at the worldwide box office to date.
Bill Desowitz, former editor of VFXWorld, is currently the Crafts Editor of IndieWire.
