In a new report, FBR & Co analyst Barton Crockett dialed back the firm’s earnings estimates and price target for Lions Gate, but reiterated FBR’s bullish stance on the stock.

Despite the recent earnings disappointments, FBR sees exciting M&A potential and a solid pipeline ahead for Lions Gate.

Recent Developments

FBR has reduced its earnings estimates and price target for Lions Gate following the company’s recent acquisition of Pilgrim Studios.

In addition, FBR’s estimates for “Mockingjay 2” are now trending below the first “Mockingjay” movie. FBR now expects “MJ2” to generate $300 million of domestic box office and $240 million in profits versus previous estimates of $380 million and $315 million, respectively.

The firm’s sum-of-the-parts valuation for Lions Gate now stands at $38.

The ‘Hunger Games’ Cliff

A November Wall Street Journal story cited…

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