‘Cars’ Will Test Disney-Pixar Merger
The release of the animated film Cars on Friday is being watched closely as a harbinger for the success of the Walt Disney–Pixar merger.
Cars is the first Pixar release since Walt Disney (nyse: DIS – news – people ) agreed to buy the computer animation company in January. Industry watchers expect the movie to fare well on its opening weekend, though just how much it will gross is a matter of speculation.
"Cars [is] likely to be neither a lemon nor a Lamborghini," wrote Banc of America analyst Douglas Shapiro in a report Thursday.
Shapiro anticipates a domestic opening weekend gross of about $65 million to $70 million, with anything well above $80 million regarded as an upside surprise and anything below $60 million regarded as a disappointment.
Earlier this week, Cowen & Co. said it expects an opening weekend figure of more than $70 million, based on Pixar's previous animated films Finding Nemo and The Incredibles, which grossed $70.3 million and $70.5 million on their first weekends, respectively.
The research firm expects Cars to bring in a total of $310 million in the U.S. and $696 million worldwide.
Cars faces box-office competition from the release of Superman Returns, distributed by Time Warner's Warner Bros., on June 30. Receipts could also take a hit from another Disney release, Pirates of the Caribbean: Dead Man's Chest, scheduled for release July 7.
Reviews of Cars have been positive but hardly stellar. Newsweek called the movie "eye-popping" but "slightly uninspiring." Industry trade Variety said the movie's periodic bursts of cleverness are "too far and few between."
Disney agreed to acquire Pixar in January in an all-stock transaction valued at $7.4 billion. The deal formally closed in May.
The companies have been feature-film partners since 1991, and have collaborated on films like Toy Story and its sequel. Disney extended its relationship with Pixar in 1997 by entering into a co-production agreement under which Pixar agreed to produce five original computer-animated features for distribution by Disney.
Cars represents the final film under that agreement.
Banc of America maintained a "neutral" rating and $30 target price on Disney shares while Cowen reiterated an "outperform" rating.