‘Superman’ Soars. Warner Bros. Stock Will Too, Says Analyst.

David Corenswet as Superman in DC Studios’ and Warner Bros. Pictures’ “Superman (Courtesy of Warner Bros. Pictures)

The Man of Steel just got a lot stronger.

After Superman dominated this past weekend’s box office, Benchmark analyst Matthew Harrigan reaffirmed his Buy rating and $18 price target for Warner Bros. Discovery stock.

While Harrigan did not expect any major movement of the stock, the film’s positive reviews and box office success eliminate the potential for Superman to be categorized as a “superhero flop,” which has been the trend for recent DC Universe franchise projects, including The Flash and Blue Beetle, according to the analyst’s note.

As of Monday’s close, Warner Bros. Discovery stock rose 2.4% to $12.01, its highest closing price since Dec. 13, according to Dow Jones Market Data. The stock has also climbed nearly 9% over the past five straight days, its best five-day run since Jun. 16. Shares are up 13.6% since the start of this year.

“Clearly, if this had fallen on its face like some other recent Marvel movies, it really would have been an issue,” Harrigan told Barron’s.

Superman soared at the box office this past weekend, grossing $122 million in domestic revenue and another $98 million in 78 international markets. The film is also the third released this year to open with more than $100 million in domestic box office sales over its three-day debut. After this weekend, summer ticket sales for all movies have surpassed last year’s sum by 16.5% so far, according to Comscore data.

The film was the first release under Warner Bros.’ new DC Universe team, led by director and screenwriter James Gunn and producer Peter Safran. The retelling stars a more human Superman—played by David Corenswet—grappling with his Kryptonian heritage and moral upbringing as he confronts an international conflict.

Paul Dergarabedian, senior media analyst at Comscore, says the film was a great outcome for the studio, noting that only a domestic opening of under $100 million would have been cause for reevaluation and a strategy change. “They have to be really breathing a collective sigh of relief at Warner Brothers Discovery,” he told Barron’s. “The implications of this moving forward could mean billions of dollars in future revenue, merchandising, theme park tie-ins, and streaming. The stakes could not be higher for this movie.”

Superman marks yet another successful film from the studio this summer. A Minecraft Movie, released in April, racked up a higher-than-expected $162.8 million domestic opening and has amassed $955.2 million in global ticket sales. Apple’s F1 the Movie, which was distributed by Warner Bros. Pictures, grossed $57 million in the U.S. during its domestic opening two weeks ago.

The release of Superman also comes after Warner Bros. announced in June that it will separate its movie studios and streaming service from its cable channels. Box office success, though, is unlikely to boost the company’s earnings. “If this movie were to come out next year post close this transaction, a hit or miss would be much more material to the earnings of the new slimmer streaming company,” Jeff Silberman, partner at Boston Consulting Group, recently told Barron’s.

And opening weekend is not the be-all and end-all for Warner Bros. “They delivered a movie that by all accounts the audiences and critics are enjoying and the numbers speak for themselves,” Dergarabedian says. “It’s that second and third weekend, that’s where the rubber hits the road.”

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