Ccord Tasty treat
DHX Media* (DHX.B : TSX : $9.78), Net Change: -0.08, % Change: -0.81%, Volume: 434,733 Sunny with a chance of meaningful upside. Shares of DHX Media hit an intraday 52-week high Friday. Most recently, DHX announced that it has acquired the TV rights for the Cloudy with a Chance of Meatballs franchise from Sony Picture Animation. The original movie was released in 2009, followed by a sequel in 2013. DHX intends to produce a 26-episode TV series. The deal gives the company both global TV and non-U.S. home entertainment rights for the TV series. Moreover, the deal gives DHX merchandise rights for the TV series on a worldwide basis. Canaccord Genuity Media Analyst Aravinda Galappatthige highlighted that this deal is another example of the multitude of ways in which DHX is able to exploit its dominant position in children’s TV, by virtue of its experience and track record in production, its distribution and merchandising relationships, and also its ownership of CPLG. In past reports, Galappatthige has touched on the many "upside" scenarios for DHX, including Merchandise success on key brands that are being refreshed, acquisitions, larger commitments from digital operators etc. This just adds to the list. First, this series could serve as a ‘driver’ as it’s a high-profile brand, helping the overall sell-through of its library of shows. Second, the upside on the merchandising side could be quite meaningful. As shown below, Cloudy with a Chance has had very meaningful box office success.