The countdown has started for the 90th Academy Awards, which will honor the best films of 2017 at the Dolby Theatre in Hollywood, on Mar 4. While the event is mainly for a creative maneuver, its huge financial impact can’t be overlooked.
Forget winning, if a film manages to seize of decent number of nominations, box-office or financial success is sure to follow. And if a film somehow gets a chance to hold the golden statuette, it has super high chances of making a killing.
Movies with Best Picture nomination from the 2008 to 2012 seasons were made on average budget of $56.9 million but registered a fantastic 55.7% increase in box office sales to $127.7 million, according to a 2014 analysis by IBISWorld.
Media Companies: Time for Celebration
Such a grand event like the Oscars acts as a drawing card for television audiences. This year, the ceremony will be aired live on American Broadcasting Company, which is owned by the Disney – ABC Television Group, a subsidiary of Disney Media Networks division of The Walt Disney Company (NYSE:DIS) (read: ETFs in Focus on Walt Disney's Q1 Earnings Beat).
ABC has sold out ad inventory for the 2018 Oscars two weeks prior to the telecast, representing “the fastest sellout in its history.” The network is likely to witness record revenues for this event this year, up by high single digits year over year.
Also, Walt Disney Studios-owned Pixar’s film “Coco” is a likely winner for both categories – Best Animated Feature and Best Original Song.
20th Century Fox can also expect rising profits from distributing The Shape of Water, The Post (in the United States) and Three Billboards Outside Ebbing, Missouri. The trio are affiliated with a subsidiary of Twenty-First Century Fox Inc. (NYSE:F) . The Shape of Water grabbed 13 Oscar nominations. In total, 21st Century Fox managed to score 27 nominations this time around.
Yet another studio, Universal Pictures, is also in the race for distributing The Post and Lady Bird internationally as well as Get Out. Warner Bros. Pictures, part of Time Warner Inc. (NYSE:TWX) should benefit from distributing another Oscar nomination Dunkirk while Focus Features, owned by Comcast Corp. (NASDAQ:CMCSA) through the Universal Pictures, should see good business for the film Darkest Hour.
Another film, Phantom Thread, which get a nod for the categories of the best film, director, supporting actress and actor were distributed by Focus Features in the United States and Universal Pictures on the international level.
Quite obviously, these media stocks and ETFs that are heavy on these companies are likely to get a boost ahead. Both DIS and CMCSA have considerable exposure to several consumer discretionary funds including Consumer Discretionary Select Sector SPDR Fund XLY with about 5.5% exposure in Disney and 6.1% in Comcast and Vanguard Consumer Discretionary ETF (HN:VCR) with about 4.4% and 5.3% share invested in Disney and Comcast, respectively.
Basically, these award ceremonies act as tailwinds for media companies, which makes it essential to look at the PowerShares Dynamic Media ETF (V:PBS) .
Internet ETFs Are on Fire Too
Oscar nominations put Internet stocks on fire as people mostly watch movies by downloading or streaming these days. As a result, Internet ETFs like First Trust Dow Jones Internet ETF FDN should perk up ahead cashing in on this event. Streaming stocks like Netflix (NASDAQ:NFLX) , Google (NASDAQ:GOOGL) (for YouTube) and Amazon (NASDAQ:AMZN) should also get an edge. Right now, one can watch eight Oscar nominations on Netflix (read: Amazon ETFs to Buy on Q4 Blockbuster Results).
Social Media is Our Third Nomination
Who can forget social media stocks and ETF? After all, discussions over any hot topic spread like a wild fire. Social media stocks like Facebook (NASDAQ:FB) and Twitter (NYSE:TWTR) are likely to make good use of the event. The best way to tap this growing awareness is with Global X Social Media Index ETF (CM:SOCL) and Sprott Buzz Social Media Insights ETF BUZ (read: These Tech ETFs Dispel Rate Hike Fears, Hit 52-Week High)