Thursday, February 25, 2010

February 26, 2010: Cop Out, The Crazies

Two movies opening this weekend, both pretty normal. The Oscars are in a couple of weeks, and that weekend will soak up moviegoers' attention, so I'm guessing that studios are dropping deadweight into the space just before that.

Kevin Smith has directed a movie about two cops called - get this - Cop Out (2COPS). I'm not a big Kevin Smith fan. Couldn't finish Clerks. I liked Dogma, but recognize that it's not a very polished film. This is the first movie that he has directed that is not from his own script. He may be thinking that it's time for him to grow up as a filmmaker, although no bets on that one. One can only stay a fanboy forever, although he is certainly stretching it out. The stock is currently in the mid-50's, down from a high in the mid-60's, and it has been edging downward for some time. The strike price is H$20, just right, with the call (2COPCA) doing well at H$3.30. The put (2COPPU) is above IPO, at H$2 and change. The CX derivative is just a smidgen below the stock. On Cantor, it's at $60, not terribly surprising. So all signs are pointing, so far, to a $20 million weekend. Except the score on, which is at 13%. I couldn't find anything even remotely entertaining about the trailer, let alone funny. Smith is a smart man, but he's not a particularly disciplined one. He has enough of a reputation to attract his fan base, but I don't think he's going to get much beyond that.
Stock: Short
Call: Short
Put: Long
CX on HSX: Short
Cantor: Short

Also coming out this weekend is what looks - to me, at least - like a generic horror movie, The Crazies (CRAZI). It's a remake of an old George Romero movie. I've never heard of the original, but that doesn't mean much. Stock is at H$42, which is a high. It's been moving up steadily. It's going out on 2,476 screens (2COPS is going out on 3,500, which I think is more of a desperation move than anything). Strike price is H$15, again, just right, with the call (CRAZCA) heading northward, at H$3 and change. The put (CRAZPU) is below the IPO, another good sign (although just barely). The CX derivative is at H$38, which is something to keep an eye on. What's particularly interesting is the critics' perspective: it's scoring an eye-popping 88% on RT. Ain't It Cool News is hosting a screening with the director tomorrow (that would be Breck Eisner, son of Michael, ex-chairman of Disney), which sounds like marketing heaven. Something about this movie sounds like it is going to be bigger than expected.
Stock: Long
Call: Long
Put: Short
CX on HSX: Long
Cantor: Long

Update Friday morning: Both of these movies are down on HSX and Cantor this morning, although 2COPS is down more, almost H$4, while CRAZI is down H$2.66 at the halt. That much of a drop confirms my opinion on 2COPS - that's a strong indication that it is going to bomb. I read a couple of positive reviews this morning, one in the LA Times, one in the LA Weekly, and a friend of mine thot the red band trailer was funny. But that same friend also expressed more interest in CRAZI. They're competing for the same audience, young men, but it sounds like CRAZI is a better movie. The drop for 2COPS comes on top of mucho negative publicity, so it confirms my opinion. CRAZI still has its fans, although it's at 72% on RT. That's still quite good. expectations are still fairly low, so I'm still going long on CRAZI.

Update Monday morning: My predictions were quite good this weekend, as were the markets'. 2COPS brought in $18.5 million, and adjusted less than H$1, to H$50.13. So I got all of those predictions right. CRAZI came in better than the market expected, but right around where I was thinking, at $16.5 million. Again, I nailed it. 2COPS had a per-screen average of $5,894, while CRAZI had a PSA of $6,572, so it did better on that score. I am staying short on 2COPS, but holding CRAZI long to delist. 2COPS had a lot more screens this weekend, but that means that there are a lot more screens to pull next weekend. Since CRAZI had a higher PSA, theaters have slightly more incentive to keep it on their screens. We'll see what happens.

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