Hulk and Harry both take a Hit from Investors

Sales of both Scholastic's and Marvel Enterprises' new blockbusters soared over the weekend, but lackluster reviews may have fostered a negative effect on investors who are now selling the stocks.
Marvel (MVL: down $2.03 to $19.17, Research, Estimates) shares fell nearly 11 percent Monday on the heels of "The Hulk" debut and Scholastic (SCHL: down $1.38 to $29.60, Research, Estimates) shares dropped more than 5 percent after the release of "Harry Potter and the Order of the Phoenix."

For Marvel, it's the third straight day investors have sold the stock, for a drop of more than 20 percent since last week.

The selling began as reviews of "The Hulk" started to come in last week and picked up after the movie fell shy of expectations, Southwest Securities' Arvind Bhatia said.

"The Hulk" was the top grossing film over the weekend at $62.6 million, but failed to approach fellow Marvel titles "Spider-Man," which set a three-day opening record of $114.8 million last year, and "X2: X-Men United," which opened with $85.6 million last month.

"The reviews weren't very high and some people were expecting it to do better," Bhatia said. "Combine that with the big run it's had, and you'll see people sell," he said, adding that the stock fell following the release of "Spiderman" as well.

Sales of 5 million copies of "Harry Potter and the Order of the Phoenix" Saturday didn't prevent a selloff in Scholastic stock. After the shares rose 37 percent from their March low leading up to the introduction of the latest installment in the Harry Potter saga, investors took some profits Monday.

"I think it's probably just a situation of buy the rumor, sell on the news," Neil Godsey, analyst at ThinkEquity Partners, told Reuters.

Book retailers fared better, however, with Amazon.com (AMZN: up $0.42 to $35.46, Research, Estimates) gaining about 1.5 percent and Borders Group (BGP: up $0.17 to $17.05, Research, Estimates) adding 1 percent, although Barnes & Noble (BKS: down $0.10 to $22.32, Research, Estimates) fell about 1 percent.

Barnes & Noble said Sunday its stores were selling as many as 80 books per second, putting the new "Potter" on course to top 1 million copies sold in just 48 hours.
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EarthsMightiestAdmin
6/23/2003
CNN/Money

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