Analyst: Paramount Q4 Disc Sales ‘Better Than Expected’

28 Oct, 2009 By: Erik Gruenwedel

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Strong initial sales of DVD and Blu-ray Disc units for Transformers: Revenge of the Fallen combined with projected robust returns for the Nov. 17 packaged media release of Star Trek prompted Pali Capital analyst Rich Greenfield to raise fiscal 2009 estimates for Viacom Inc.’s film division, which includes Paramount Home Entertainment.

Greenfield said the Transformers sequel, which generated 7.5 million disc sales, including 1.2 million Blu-ray copies, according to Home Media Magazine market research, would sell from 10 million to 12 million discs (including rental) in North America in the next several months.

Indeed, the analyst said over-the-top theatrical results for low-budget horror thriller Paranormal Activity further buoyed Viacom’s filmed entertainment results and outlook.

“[The film] has exceeded $61 million with virtually no marketing cost (online viral marketing drove the film), with the potential to reach $100 million domestically,” Greenfield wrote in a note.

That prognosis prompted the analyst to upgrade Viacom’s stock to “buy” from “neutral” status earlier this year.

The media conglomerate reports fourth quarter results Nov. 4.
 

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