I agree, it is also a good trading stock. To each is own.
The Alliance situation, from what I've been told on both ends, was that Alliance needed the money (they continue to raise even more) and that the management's budded heads a bit on various projects. The MFE guys said give our creation back or we bolt. They didn't have much of a choice. But, frankly, it don't matter much now. They seem to work together nicely with their projects.
As for growth areas in the world, I think I'd take high quality, unique childrens entertainment any day over the food trade, and especially now. The demographics are pretty phenomenal for secular growth and the amount of money being spent just keeps growing. It's all the guilty baby boomers spoiling their kids.
Talk about repeat business, the umpteenth repeats of ReBoot and Beast Wars still attract top-rated audiences. I guess it's a drug for some kids. I can't figure it out, but it works and that's what sells. It's pretty phenomenal that these repeats are still so highly rated around the world. It appears there's an unmet demand of some sort.
But I'm with you --I'm not wedded to any idea or stock and ultimately there's proof in the bottom line. But also, some very good businesses develop over the years and need to reinvest income to keep up with the growth. By the way, Mainframe's cash flow, a very good indicator of the profitability of a company is around $4mil this year and projected 13mil next year not including a movie.
I hate the comparison, but Steve Jobs made a boatload of money by funding a few years of losses at Pixar and selling it when they realized just one project. Check with all the major studios, they're all extremely interested in the application of technology to animation and the exploitation of "digital assets" in many forms. It's an efficient and feasable way to do the mythical "cross business" synergy that they all want. So, my bet would be that when some of these projects move forward, they'll spin-off all sorts of other projects. Just look at ReBoot --the asset went from TV to toys to IMAX to a computer game. Pretty neat usage of the asset. The First Marathon report specifically mentions this strategy as something that Universal's management wants to pursue. We know they've talked, they're probably interested. We'll just have to see. I'm sure others are too. |
