The summer box office ended with a bang with the best ever Labor Day weekend. Led by the latest edition of Halloween series, the box office for the top 12 films rose 21.6% over last year’s holiday weekend. Based on data from BoxOfficeMojo.com, ticket sales for the weekend should be the highest since at least 1982. Halloween provided most of the gas this weekend, smashing the all-time Labor Day weekend record with a better than expected $31 million for the four days. The prior record holder was Transporter 2, which pulled in $20 million in 2005.
I’ll have a full recap of the summer box office on Thursday. For now, it looks like the 2007 will be the best ever summer by as much as 8%, coming in $300 million ahead of the prior record in 2004. Using BoxOfficeMojo data for ticket prices, it appears that ticket sales in summer 2007 exceeded 2004 by 2% and may have approached the 2002 ticket sale record.
Quarter-to-date the box office remains up 17%. Analysts are beginning to ratchet up estimates with Regal Entertainment seeing at least two boosts in the last ten days. The shares have responded, rising 5.3% in August and sitting just 2.6% below the all-time high, reached in May and early June as anticipation of a strong summer box office initially peaked….

….Comparisons remain easy for the rest of September in what is usually the second of third slowest month of the year. I expect the 17% quarterly gain to moderate slightly but the news should remain favorable. As investors look at a year-to-date gain of almost 8% and realize this is the second consecutive year of solid growth, sentiment toward theater stocks should continue to improve. I am still looking to sell RGC as it moves to new highs because 2008 comparisons will be very difficult although the shares are likely to remain a solid relative performer given the 5.3% current yield.