Friday January 18, 2013
by Leo Fasciocco, editor Ticker Tape Digest
Our latest featured breakout stock is Lions Gate Entertainment Corp. (LGF), which has moved above its breakout point at $16.94 to hit a new high.
With annual revenue of $2.2 billion, the firm produces motion pictures. They are distributed via television, syndication, home entertainment, digital distribution and new channel platforms.
During fiscal 2012 ending in March, LGF produced 14 motion pictures. (Hunger Games, released in 2012, was the studio's highest grossing film.)
It is also active in making acquisitions. In 2012, LGF acquired Summit Entertainment LLC, a motion picture development firm.
Over the last 12 months, the stock has risen 110% versus an 18% gain for the S&P 500 index.The stock's momentum indicator is strongly bullish. The accumulation - distribution line is in a solid up trend indicating good buying interest.
This fiscal year ending in March of 2013 analysts forecast a profit of 96 cents a share compared with a loss of 60 cents a year go.They have been boosting their earnings projections. The stock sells with a p/e ratio of 18. We see that as low.
Next fiscal year 2014 ending in March, analysts project a 48% jump in net to $1.42 a share from the anticipated 96 cents a year ago. That year estimated has been boosted too.
For the upcoming fiscal third quarter ending in December, profits are expected to come in at 27 cents a share compared with a loss of one cent a year ago. Profits will be reported on February 7.
Net for the fiscal fourth quarter ending in March of 2013 should jump 96% to 41 cents a share from 21 cents a year ago.
Institutional sponsorship is excellent. The 5-star rated Fidelity Growth Company Fund is the second largest holder with a 2.9% stake. Also, the Fidelity Disciplined Equity Fund was the largest buyer recently picking up 1 million shares.
We first featured LGF as a bullish play about two months ago and also at that time noted the significant bullish pattern of insider buying and very little selling.
We rate LGF a very good intermediate-term play provided earnings meet expectations.We are targeting LGF for a move to 21.50 off this breakout. A protective stop can be placed near 15.50.
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