Stifel Nicolas analyst Drew Crum this morning raised his rating on Dreamworks Animation (DWA) to Buy from Hold, setting a $35 price target. Crum notes that the company’s shares are down 35% from recent highs, and contends the stock is oversold.
Crum thinks the Street may be too pessimistic on the company’s 2010 films. He notes that How To Train Your Dragon, with box office of more than $260 million, has “quietly surpassed projections” in the $240 million range. He adds that there will be a “meaningful” contribution from Shrek Forever After, noting that the movie has yet to be released in many parts of the world, and contends the film could eventually hit $450 million in box office receipts. And he says Megamind, to be released in November, “could surprise the to the upside” as expectations for the movie are low.
DWA is up $1.09, or 3.8%, to $29.49.
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