DOW JONES- $13025.58

S&P 500- $1416.18

NASDAQ- $3010.24

The Walt Disney Co.- $49.66

News Corp.- $25.22

Time Warner Inc.- $47.30

This week in my industry, entertainment diversified, according to the Motley Fool, Disney is shaping up to be the movie powerhouse over the next five years. Disney is massive and even producing one movie costing $500M would have a small effect on their revenues. However, I think that movies will tend to be on the higher margin side as long as they are very successful, and the budget is planned out. Disney bought Marvel a few years ago and the Marvel universe really hit it out of the park. The quality of movies and the integration managed to work out really well. Obviously, some movies were better than others, but overall I think the whole brand has tremendous potential. So many movies are in the works, and the revenue potential for Walt Disney Co. is enormous. At least in the sense that hit movies tend to have some nice returns. I see this as a high margin endeavor if it can be pulled off. It's safe to say that the rest of the movies planned for the Marvel cinematic universe will be successful. Ironman 3 looks to be a pretty impressive movie. Disney also has all its other great movies from Pixar like Brave. Overall, Disney looks to be set up very well over the next couple years.

According to The Wall Street Journal, News Corp. plans to name Robert Thomson, who is of the Wall Street Journal, as the CEO of their soon-to-be-created publishing company. The announcement, which could come this week, would fill in a critical detail about the publishing company. News Corp. in June said the media conglomerate would split into two listed companies. The split will separate News Corp.'s entertainment assets, such as the 20th Century Fox film studio and Fox News cable channel, from its publishing assets. Overall, I feel that this decision will help News Corp. generate greater revenue and profit.

DOW JONES- $12588.31

S&P 500- $1359.88

NASDAQ- $2853.13

The Walt Disney Co.- $47.42

News Corp.- $23.74

Time Warner Inc.- $44.70

In recent news from my industry, entertainment diversified, according to Forbes, the price estimate for News Corp stands at $28, which implies a premium of more than 15% to the market price. Forbes goes on to say that there is potential for the company to unlock more value if they can sustain margin growth it has seen in the past few years. They believe News Corp could be a $31 stock if its cable networks’ margins continue to increase to a point where they can rival those of Disney, their competitor. News Corp has demonstrated strength in its cable networks business driven by an improvement in advertising and subscription fee. This segment saw 16% growth in revenues in the recent quarter thanks to 16% and 25% growth in affiliate revenues for domestic and international operations, respectively. This growth has resulted from News Corp’s focus on its sports network and original content for other networks such as FX, which has allowed the company to negotiate price increases. As a result, margins have grown too.

From what I have read and have been reading about News Corp over the past couple weeks, I believe that the company can and will continue to grow and succeed and become more valuable over the next few years. The company has made some deals to renew their contract with its CEO that has helped get them to where they are today. Also they have made deals to acquire other companies to expand its reach. Therefore I believe investing in this company would be a smart and profitable decision.

DOW JONES- $12815.39

S&P 500- $1379.85

NASDAQ- $2904.87

The Walt Disney Co.- $47.06

News Corp.- $24.74

Time Warner Inc.- $44.67

This week in my industry, entertainment diversified, according to Zacks Equity Research, News Corporation announced the completed acquisition of The Walt Disney Company’s stake in their joint venture “ESPN STAR Sports (ESS).” ESS was the 50/50 joint venture between Disney’s ESPN and News Corporation, providing Asian sports fans a diverse collection of sports programs across 24 countries through 28 networks.

Earlier in June, the company announced that it will acquire ESPN’s 50% stake in ESS.  ESS, with its right mix of exclusive sporting licenses with top sporting leagues emerged as an industry leader in the pay-TV industry. With the acquisition, ESS is now the wholly-owned subsidiary of News Corporation. We believe that the buyout will enhance the company’s position in sports programming, thus bringing in incremental revenues through advertising and subscriptions.

Further, owing to a mandatory shift to a digital addressable system in India, the move better positions both the companies to independently manage their brands and generate positive cash flows while significantly expanding digital opportunities. News Corporation strives to add diverse revenue streams to hedge against economic volatility. The company is focusing on the emerging markets to expand its media business, since these regions have millions of viewers.

News Corporation’s significant international presence has helped it broaden its client base and product portfolio. Among others, the company competes with Time Warner Inc. The company recently posted first-quarter 2013 earnings of 43 cents a share beating the Zacks Consensus Estimate of 37 cents, and rose 34% from 32 cents earned in the prior-year quarter on the back of double-digit growth across Cable Networks. Including one-time items, News Corporation posted quarterly earnings of 94 cents a share, soaring from earnings of 28 cents delivered in the year-ago quarter.

Things for News Corp. are looking quite well and I look forward to seeing their stock prices continue to increase and for them to continue to make acquisitions and smart choices that will benefit stockholders.

DOW JONES- $13,093.16

S&P 500- $1414.20

NASDAQ- $2982.13

The Walt Disney Co.- $49.86

News Corp.- $24.26

Time Warner Inc.- $43.36

This week in news from my industry, entertainment diversified, according to Wall St. Cheat Sheet, Disney has announced it will acquire Lucasfilm, the company behind the Star Wars saga, in a $4.05 billion deal, also revealing with the announcement that it plans to release a seventh movie in the series. The cash and stock deal adds Lucasfilm to a portfolio of stand-alone brands owned by Disney, including Marvel, ESPN, and Pixar.

“For the past 35 years, one of my greatest pleasures has been to see Star Wars passed from one generation to the next,” said Mr Lucas, chairman and chief executive of Lucasfilm. “It’s now time for me to pass Star Wars on to a new generation of filmmakers.”

Disney’s “reach and experience” will help Lucasfilm “blaze new trails in film, television, interactive media, theme parks, live entertainment, and consumer products,” he added.

The deal for Lucasfilm is the third multi-billion dollar acquisition to be made under CEO Bob Igner, who also oversaw the $7.4 billion purchase of Pixar in 2006 and the $4 billion purchase of Marvel in 2009. Lucasfilm also brings with it a considerable consumer products business, with revenues in 2012 comparable to the $215 million generated by Marvel Entertainment before it was acquired in 2009. Lucasfilm’s licensing and merchandise potential, particularly in international markets, was a large part of its appeal for Iger. The six Star Wars films have generated a grand total of $4.4 billion at the box office — no mean feat but hardly justifying Disney’s $4 billion acquisition offer alone. The deal also includes Lucasfilm’s prized high-tech production companies, Industrial Light & Magic and Skywalker Sound, as well as rights to the “Indiana Jones” franchise, the most recent film of which grossed $786.6 million at the box office globally.

I believe this deal is a very smart move for Disney. I believe that in a couple of years this deal will increase stock prices and overall profits. I am also very excited, along with many others, about a new Star Wars movie being made.

DOW JONES- $13,107.21

S&P 500- $1411.94

NASDAQ- $2987.95

The Walt Disney Co.- $50.08

News Corp.- $24.21

Time Warner Inc.- $43.64

In news from my industry, entertainment diversified, according to the Sunday Times, News Corp.’s Robert Murdoch has indicated that it will make a substantial cash offer for media conglomerate Pearson’s Penguin Group, joining the race for the book publisher. It is said that the bid could total $1.6 billion and could scupper plans to tie Penguin with Random House, owned by Germany’s Bertelsmann. As of right now, News Corp. owns book publisher HarperCollins. According to the report, the combination of HarperCollins and Penguin together would have a market share of 20 percent, while a combination of Random House and Penguin would control nearly 30 percent of English-language book sales. Pearson confirmed on Thursday that it was in talks with Bertelsmann, but said the two had yet to agree to a deal. If News Corp. does in fact join forces with Pearson it could be a great and profitable venture that will benefit stockholders significantly. However, if Pearson joins with Bertelsmann, News Corp. could lose money in the long run.

In other news from my industry, according to Reuters, premium cable network HBO delayed the launch of video and online distribution of its programming in four Scandinavian countries, giving a head start in the region to a video streaming service by rival Netflix Inc. HBO Nordic, the joint venture that runs the service, said in a statement to Reuters it had “slightly” pushed back the start date in Finland, Norway, Sweden and Denmark. It did not give a precise reason for the delay. HBO Nordic is a joint venture between Time Warner Inc –owned HBO and Parsifal International. Netflix launched its on-demand video service in the Nordic countries last week. As a result of this area being a “global battleground” for television delivered over the internet, this delay by HBO Nordic may very well cause Time Warner stocks to decrease.

DOW JONES- $13,343.51

S&P 500- $1,433.19

NASDQ- $3005.62

The Walt Disney Co.- $51.90

News Corporation- $25.36

Time Warner Inc.- $44.93

In news from my industry, entertainment diversified, according to Bloomberg News Corp.’s Roger Ailes signed a four year contract extension to lead the network and Fox Television Station. Ailes was the man who built Fox news into the most watched cable news outlet. At seventy-two, Ailes will remain chairman and chief executive of Fox News and chairman of the Fox stations. Ailes is among the company’s highest paid executives, making more than $21 million in salary, bonus and stock awards in the fiscal year that ended June 30. According to SNL Kagan, Fox News was expected to generate more than $1.8 billion in revenue in 2012. In my opinion, the resigning of Ailes will allow News Corp. to continue growing in popularity and its success.

In other news, according to seekingalpha.com, IMAX Corp. stock is trading around $21.50 which is up 37% from the past years 52-week range of $15.33-$26.68. Films such as the Dark Night Rises, Resident Evil: Retribution, and the Amazing Spiderman, are expected to have a positive impact on revenues with consensus being 75.7 million, which is up from $67.5 million reported last year. China is operating 98 IMAX theaters, making it an important market for the corporation. Given the non-competitive nature of the market, and the weak economy in China, Management’s color on the performance in China will be important. The biggest risk for investing in IMAX is the health of the box office. The companies choice of films, the timing of the films, and the overall performance will be the primary focus of investors. I believe that if IMAX can continue to grow and do well than the whole entertainment industry will benefit.

Also in news for my industry, News Corp.’s Rupert Murdoch denied it has held talks to acquire the Los Angeles Times or Chicago Tribune once the newspapers’ owner, Tribune Co., emerges from bankruptcy. I think this would be a positive and smart deal for News Corp. I think this deal would have significantly increased revenue and popularity. However, it may take some time for News Corp. to begin reaping the benefits of a deal like this so I understand why this deal may not be made.

DOW JONES- $13,328.85

S&P 500- $1,428.59

NASDQ- $3044.11

The Walt Disney Co.- $50.59

News Corporation- $24.58

Time Warner Inc.- $45.06

This week in the industry of entertainment diversified, according to Bloomberg, Providence Equity Partners Inc. sold its ten percent stake in Hulu.com back to the company for $200 million. This deal is said to value the video service at around $2 billion. Hulu is borrowing the money to fund the repurchase. Hulus’ Chief Executive Officer will receive about $40 million from this deal. As a result of this deal, it is said that employees of Hulu will be able to sell shares. Providence had invested $100 million in Hulu when the venture began in 2007. Disney, News Corp. and Comcast’s NBC Universal each held roughly equal stakes, while employees owned about ten percent.

I am not exactly sure how this deal will affect stock prices, however the stock prices of those companies that have stakes in Hulu, such as Disney and News Corp., have dropped significantly, whether it is a direct result of this deal taking place or not I cannot be sure but it may very well have affected them.

In other news from the industry London’s Sunday Times said it may take legal action against cyclist Lance Armstrong. This legal action could include pursuing him for alleged fraud over a liberal settlement, in the wake of the report labeling him a drug cheat. The newspaper is owned by Rupert Murdoch’s News Corp. Armstrong  sued the Sunday times and two of its journalists over an article that appeared in the paper in 2004 that concerned the doping allegations. A senior source at the newspaper said that the case cost them about $1 million dollars. In August, Armstrong said he would no longer contest charges brought by the anti-doping agency.

Now that Armstrong is no longer contesting these charges, those that have endorsed him and supported him in any way may very well suffer from the huge fall of this once praised athlete. 

DOW JONES- $13,610.15

S&P 500- $1,460.93

NASDQ- $3136.19

The Walt Disney Co.- $52.97

News Corporation- $25.48

Time Warner Inc.- $46.18

This week in the industry of entertainment diversified, according to Bloomberg, the first debate between President Obama and candidate Mitt Romney attracted 67.2 million viewers which is 28% more than the first debate four years ago. The Walt Disney Company’s ABC drew 11.3 million viewers and News Corporation’s Fox News received 10.4 million viewers, which led all cable networks. NBC drew 11.1 million viewers, CBS averaged 10.6 million viewers and Fox Broadcasting network drew 6.9 million. Time Warner Inc.’s CNN drew 6.05 million and MSNBC had 4.71 million. This is great news for the broadcast networks, increased viewing at this stage in the campaign will hopefully mean higher viewing percentages throughout the entire campaign.

Also in the news for entertainment diversified, according to Wall St. Cheat Sheet, The Walt Disney Co. reached a carriage agreement with Cablevision. This deal will allow Cablevision to offer its customers popular channels like ABC, ESPN, Disney Channel and many others. This will expand Disney’s reach and will hopefully increase stock prices and revenues.

Other news includes News Corporation pushing the Media industry higher on Thursday and was the days featured media winner. The industry as a whole closed the day up 1.4% and by the end of trading News Corp. rose twenty-eight cents.

In other news, according to Wall St. Cheat Sheet Doug Kass a Hedge-fund manager says he is unimpressed by Apple’s performance this year and feels the company may be losing its golden touch. Kass feels that Apple is losing some mojo and mindshare. He, along with other analysts feel that the reaction launch of the iPhone 5 has not been as positive as previous Apple products have seen and this is the first time Apple has no wow factor compared to other products in the market. 

DOW JONES- $13,437.13

S&P 500- $1,440.67

NADSAQ- $3,116.23

The Walt Disney Co.- $52.28

News Corporation- $24.79

Time Warner Inc.- $45.33

This week in the industry of entertainment diversified, according to the Motley Fool, Google Inc. has proven that their YouTube segment can develop and market content to compete with major broadcast channels. One of the YouTube funded video-series was picked up by ABC, which is meant as an example of the potential and quality of some videos on YouTube. Google plans to extend its’ program to fill a 30min. time slot on Disney’s ABC network. Google is hoping this is a sign of bigger and better things to come. It has always been a desire of YouTube to become a key player in the entertainment industry. They we blocked by ABC, CBS, and NBC in 2010 from having their online versions of their full programs played. This kept Google TV from reaching its full potential. If the big name companies would not have blocked their shows from playing on YouTube, they would have had an advantage over cable companies.

If YouTube does increase its reach and its programing, it could lead to decreases in the value of the stocks of The Walt Disney Co., News Corp, CBS Corporation, and Time Warner Inc. However, even if YouTube does become a key player in the entertainment industry, they will not be able to generate near the amount of revenue that the previously mentioned companies do. Therefore, the overall negative effect on these companies will not be great.

Also in news form my industry, I read that ticket sales at movie theatres are still falling short of the same weeks in 2011. None of the four movies that opened this past weekend drew large crowds. The movie End of Watch led the way with $13.2million in ticket sales, the Avengers sold around 16 times as many tickets when it opened. This continuing trend of low sales could mean a big problem for Hollywood and the entertainment industry as a whole.

DOW JONES- $13,579.47

S&P 500- $1,460.15

NADSAQ- $3,179.96

The Walt Disney Co.- $52.74

News Corporation- $25.08

Time Warner Inc.- $45.90

In the industry of Entertainment Diversified, I found out that the U.S. government is dropping a lawsuit against News Corp.’s Fox network over their refusal to pay indecency fines for a 2003 broadcast. The Justice Department said, without elaboration, that they are voluntarily dismissing the case. I believe this action could lead to higher stock prices for News Corp. since there is no chance of them having to pay a large fine for the incident. Without this lawsuit hanging over their heads they are free to move on to focus on more pressing matters of business.

Also in my industry Walt Disney hit a new 52-week high. TheStreet Ratings rates Walt Disney as a buy. They say the company’s strength can be seen in multiple areas. These strengths outweigh the fact that the company shows low profit margins. As stated in my previous blog,  many people believe Disney is an undervalued company that has a huge market in the United States and is expanding their reach to other areas of the world.

Another very interesting article I read about my industry was about Disney joining forces with J.C. Penney. The Walt Disney Company will partner will J.C. Penny to open more than 500 in-store boutiques featuring Disney products designed exclusively for the retail giant. According to The Motley Fool, an account from one person claims that each Disney shop will sell costumes, figurines, footwear, apparel for boys, girls, and babies. Some see this move as a speculative play, because of J.C. Penney’s decrease in same-store sales in excess of 20% and a net loss of $81 million. However, Swiss bank Credit Suisse raised its price target on Disney to $58 a share from $56. I am hoping this move pays off and Disney stocks increase and not decrease significantly because of this move. I am an optimist and believe Disney can make this work for their benefit. 

DOW JONES- $13,593.37
S&P 500- $1465.77
NASDAQ- $3184.95

The Walt Disney Company- $52.35
News Corporation- $24.91
Time Warner Inc. - $44.71

In the news for my industry, Entertainment Diversified, I found out that the movie industry may be dying. According to The Motley Fool, the movie industry received its’ lowest levels in over ten years, bringing in just under $52 million from the top twelve grossing films. The last time these levels were that low, it was two weeks after the September 11^th attacks.  September has always been a bad month for Hollywood, being named a “dumping grounds,” but there seems to be something more going on this month.  Some speculate a reason for this may be the lack of newness or change in the movie-going experience in the last decade. As a result, the theatres and studios are finding it hard to make a profit on many of their movies.

I am not sure how much truth there is to the speculation of the industry’s decline because all of my stocks have only increased in value. However, if these levels continue to stay low, my stocks could be severely affected and their value diminished. Hopefully some new technology or innovation can be brought to the movie industry that helps boost revenue and allows stock prices to rise.

Also in my industry, according to Bloomberg.com, News Corporation has decided to separate its LA film and television production units. Along with the decision to separate the two units, co-chairman and CEO of Twentieth Century Fox movie studio, Tom Rothman resigned. Rothman helped oversee both the movies “Avatar” and “Titanic” which happen to be the first and second highest grossing movies on the all-time list, globally. This is a huge loss for News Corporation and I fear their stocks may lose some value for a while as a result.

DOW JONES- $13,306.64
S&P 500- $1,437.92
NASDAQ- $3,136.42

The Walt Disney Company- $51.74
Time Warner Inc.- $24.66
News Corp.- $43.64



I chose Entertainment Diversified as my industry because I thought that companies such as Universal, Paramount, and Disney would be included in the industry. However, when I went to pick my three companies for my stock portfolio I was surprised to find how few public companies were in my industry. The Walt Disney Company was a publicly traded company so I chose it because Disney is a largely successful company and I knew it would be a safe investment. I chose my other companies by looking at their revenue streams and chose my other two companies based which company brought in the most profits per year. I was quite surprised how cheap a single share in Disney, only being around $50. I knew it was a safe investment because everybody loves Disney. Then while reading news on my industry I found that other people agree that Disney is undervalued. Disney, not only has a huge market in the United States already, they are increasing their fleet and also transforming their Disney California Adventure, and Disney is expanding their reach, building parks in Hong Kong and Shanghai.

Also in my industry, I read that CNN led cable news ratings for Obama's convention speech. Time Warner Inc., which owns CNN, averaged 5.56 million viewers. The Walt Disney Companies' ABC drew 4 million viewers, CBS Corp. received 3.29 million, and News Corporations' Fox received 2.91 million viewers. Before reading this article I did not know which companies owned companies such as Fox, ABC, and CNN. This article gave me much insight into my industry and the companies involved in this industry.