DreamWorks Animation (NYSE: DWA) received a nice gift from Goldman Sachs (NYSE: GS) today. The cartoon studio has been put on the institution's famous Americas Conviction Buy list, according to an article out on Reuters.

Goldman Sachs believes that the company should see a lot of prosperity in the next six months. The stock might even rise as high as $45 per share, if the price target is to be believed. The premium attached to 3-D movie tickets is part of the thesis here. As well as something else, something a lot more powerful: the franchise value of Shrek.

DreamWorks Animation (NYSE: DWA), whose cartoons compete with similar products from Disney (NYSE: DIS), News Corp. (NASDAQ: NWS), Viacom (NYSE: VIA), Time Warner (NYSE: TWX), and Sony (NYSE: SNE), issued its Q1 stats after the bell on Tuesday afternoon.

Now, I'm just about 100% certain that I've used this goofy pun before, so let me apologize upfront for dragging it out yet again (you'll soon see that I had no choice): DreamWorks Animation had a quarter that dreams are made of!

DreamWorks Animation (NYSE: DWA), the computer-cartoon studio that competes with the animation product of other entities such as Disney (NYSE: DIS), News Corp. (NYSE: NWS) and Sony (NYSE: SNE), posted Q3 results after the close on Tuesday. Revenues saw a modest decrease of almost 6%, coming in at $151.5 million. I am categorizing a 6% decrease as modest in this case because the studio had a Shrek sequel out in the previous year. The drop was expected. Net income was 41 cents per diluted share, a figure which includes a $0.03 tax benefit. Even so, DreamWorks Animation beat expectations. Wall Street was counting on only 32 cents per share.

Operational cash flow isn't faring too badly. It increased 9%, and the company seems to be doing well enough in terms of generating revenues from its portfolio of films. Kung Fu Panda helped to drive the quarter, but it isn't done yet, as the home-video release should affect Q4 in a most positive manner.

Now that the data is out, DreamWorks Animation is really readying itself for its next big test. Madagascar: Escape 2 Africa, the sequel to the hit Madagascar, is waiting in the wings. In fact, the wait is almost over. The film is due November 7, and the company needs to post big numbers on this one.

Here are a few highlights from this past week's earnings coverage from BloggingStocks:

• American International Group Inc. (NYSE: AIG) posted a big loss and warned of more to come.
• CBS Corp. (NYSE: CBS) beat expectations even though its fourth-quarter profit fell.
• DreamWorks Animation Inc. (NYSE: DWA) 2007 earnings and revenue soared, lifted by Shrek the Third.
• HJ Heinz Co. (NYSE: HNZ) posted solid third-quarter earnings and revenue.
• Koppers Holdings Inc. (NYSE: KOP) beat fourth-quarter expectations and approved a share buyback plan.
• Netflix Inc. (NASDAQ: NFLX) raised its first-quarter and full-year guidance on subscriber growth.
• Nortel Networks Corp. (NYSE: NT) missed expectations due to rising operating costs.
• Origin Agritech Ltd. (NASDAQ: SEED) 2007 earnings sank, missing analysts' expectations.
• Salesforce.com Inc. (NYSE: CRM) beat fourth-quarter estimates and offered revised guidance.
• Sirius Satellite Radio Inc. (NASDAQ: SIRI) narrowed its loss due to a surge in subscribers.
• Swiss Reinsurance Co. (OTC: SWCEY) quarterly EPS plunged but 2007 decline was less than expected.
• Viacom Inc. (NYSE: VIA) reported strong fourth-quarter and full-year results.

Also, analysts predict that bank losses will be the highest in 20 years. Timothy Sykes recommends investors not become starstruck by superstar companies such as Apple Inc. (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG).

Upcoming results to watch for include Staples, Inc. (NASDAQ: SPLS), Costco Wholesale (NASDAQ: COST), and Blockbuster Inc. (NYSE: BBI).

Visit AOL Money & Finance for more earnings coverage.

DreamWorks Animation (NYSE: DWA) is one of those fun stocks to own. Who wouldn't be happy pinning their portfolio's fortunes to Shrek and a bee character based on Jerry Seinfeld? Yep, this is a play on Hollywood animation; the question is, how did DreamWorks do for its fourth quarter and fiscal year?

DreamWorks Animation can be very competitive with Disney (NYSE: DIS) and its Pixar brand when it comes to computer cartoons. For that matter, it is competitive with others like Sony (NYSE: SNE), Time Warner (NYSE: TWX), News Corp. (NYSE: NWS), and Viacom (NYSE: VIA) -- they've all had computer cartoons in the marketplace. This latest earnings report proves it. Revenues for Q4 increased 42% to $290 million, and earnings came in at $0.98 per diluted share -- this compares to a loss of $0.20 per diluted share in the year-ago period. Revenues for the full year truly were animated -- they rose 94% to $767 million. Earnings for 2007 equaled $2.17 per diluted share. Talk about blowing away the previous year's stat -- 2006 earnings per stub came in at a mere $0.15.

Viacom's (NYSE: VIA) Paramount studios had a pretty kickin' year at the multiplex in 2007. According to Boxofficemojo.com, Paramount came out on top in terms of market share at 15.5%. It distributed some great hits -- Transformers, the DreamWorks Animation (NYSE: DWA) films Shrek the Third and Bee Movie, Will Ferrel's Blades of Glory comedy, and Eddie Murphy's Norbit. Viacom's movie business seems to be doing better. According to the latest 10Q for the reporting period ending September 30, 2007, operating income for the filmed-entertainment segment was $71.7 million versus a loss of nearly $8 million in the previous year's comparable quarter (the nine-month period still showed a loss). So, Paramount needs to keep the momentum going this year. How will it top the power of last summer's blockbuster Transformers? With a little swashbuckling help from Indiana Jones, of course!

To get things started, the media company sent out a press release alerting fans of fast-paced adventure that the first teaser trailer for Indiana Jones and the Kingdom of the Crystal Skull will be released on February 14 during ABC's Good Morning America program and in theaters across the globe. For those of us who've been waiting with a will of patience that was oftentimes as excruciating and as taxing as sitting through yet another news item about Britney Spears' latest mental breakdown, this is one heck of a Valentine, although I do hate teaser trailers (they are, after all, such a tease!).

Will the new Indy flick be a big hit this summer? I think it will be, although it isn't an absolute given, since a lot of the younger demos probably find the Raiders aesthetic a bit antiquated these days; plus, there will be stiff competition from Disney's (NYSE: DIS) new Pixar cartoon Wall-E, Time Warner's (NYSE: TWX) The Dark Knight, and Marvel's (NYSE: MVL) Incredible Hulk project. Still, we're talking about George Lucas and Steven Spielberg here, and they still retain a lot of cultural pull with all demographics. Viacom and Paramount will probably be happy with the results from Crystal Skull come the summer , although I think it's safe to assume that Lucas and Spielberg will be taking a large portion of the grosses. Nevertheless, Viacom is in on the action, and I'm sure it wouldn't want it any other way.

Disclosure: I own shares in Disney and Marvel.

I recently blogged about my concerns if Evan Almighty flopped this weekend.

I, as well as many others, would classify the $32.1 million opening weekend of Evan as a flop. Peter Sanders of the WSJ believes that Evan Almighty was the first "major pothole" in Hollywood's sequel-filled summer. He also put Evan in the same category as Spider-Man 3, Shrek the Third and Pirates of the Caribbean: At World's End, by saying May's blockbuster "threequels" were all expected to fall short of their previous domestic sales numbers.

Could that be true? Looking at the numbers, Sanders has a good argument. That's only if you thought sequels should outperform the original. Other than Shrek II, most of the recent sequels made less than its predecessors. Even the Harry Potter franchise couldn't make a sequel that outperformed the $317.5 million earned from Sorcerer's Stone.

McDonald's Corp (NYSE: MCD) released its May sales numbers today and posted a very respectable 8.7% same-store sales growth for the month, which was the largest one-month increase in over three years. The stock has traded up a nice 1.6% on the day to $51, up $0.79, as traders react to the monthly sales growth, which easily beat analyst estimates of 5.4%.

The company stated that a big reason for its strong U.S. sales growth was its promotional tie-in with Dreamworks Animation SKG Inc. (NYSE: DWA)'s movie Shrek the Third which helped to lift U.S. same-store sales 7.4% in the month. Another big part of the company's recent success has been the continued strength of its breakfast lineup.

McDonald's has definitely been a great turnaround story over the past couple of years. At the turn of the century things were definitely looking a bit sour for the fast food giant, with share prices stumbling sharply between 2000 and the start of 2003, but since the second half of 2003 the stock has been on fire. How much higher can this Cinderella stock climb? With a current P/E of 17, we could see some more upside for sure, but I wouldn't be all that surprised to see the stock start to level out around $55. That is unless it can find another nice green ogre to kiss it even higher.

We're not even to Memorial-Day weekend, and another box-office record has been broken.

Shrek the Third, the latest in the successful animated series from DreamWorks Animation SKG (NYSE: DWA), enjoyed the third-biggest opening for a domestic film, and easily broke the record for the genre held by Shrek 2, which banked $108 million during its first weekend of release.

The latest adventures of green ogre Shrek (voiced by Mike Myers) and his compadres, including wife Fiona (Cameron Diaz) and donkey sidekick (Eddie Murphy), drew in $122 million in box-office receipts, during its first weekend, easily exceeding industry expectation of between $80 million and $110 million. Remember that doesn't include the mammoth sales of Shrek merchandise.

Other stars lending their vocal talents to the movie include triple-hyphenate Justin Timberlake, Antonio Banderas, and The Office's John Krasinski.

Don't look for Shrek's stay at the top to last for two long, however.

Walt Disney's (NYSE: DIS) Pirates of the Caribbean: At World's End comes swashbuckling into theaters this upcoming Memorial Day weekend, and will almost certainly nab the number-one spot. Last year's Pirates of the Caribbean: Dead Man's Chest (the second in the series) had the biggest domestic weekend opening ever until Spider-Man 3 broke that record earlier this month.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

In a bold PR move, McDonald's Corp. (NYSE: MCD) is using a thinner version of spokesogre Shrek for a campaign to promote its healthier offerings such as salads and apple slices. The character also is appearing in government public service announcements encouraging kids to be physically active.

Take that, childhood obesity critics.

I'm not sure how thin the new Shrek will be. The trailer for his new movie shows that he's not exactly svelte. How would he lose the weight anyway? Dragon slaying? Chasing fairytale creatures from his beloved swamp? Pilates?

This is a brilliant idea.

Shrek 3 and Spider-Man 3 are coming to a movie theater near you, just as the sector is coming out of an ugly downturn.

Overcapacity and over-leverage had led to an ogre-ish performance causing theater operators to file for bankruptcy or get picked up by private equity.

Now theater companies are going public or emerging from bankruptcy with little fanfare. However, according to Buzz Zaino, long-time great stock picker at Royce Opportunity Fund, it is time to start looking at these stocks again. In Barron's fund-manager interview (subscription required), Zaino said box-office receipts are up 7.2% year-to-date with a summer of good new releases expected to keep the momentum going.

Carmike Cinemas Inc (NASDAQ: CKEC) looks particularly attractive since it has upgraded 75% of its screens to digital, on which, in addition to showing movies, new alternative concepts are expected to generate additional revenue. Other movie chains Zaino likes are Regal Entertainment Group (NYSE: RGC) and Cinemark Holdings Inc (NYSE: CNK).

Expected improvements in box-office receipts should lead to nice incremental EBITDA margins especially for Carmike since its theater upgrade is mostly completed.

Few have mentioned theater stocks as a place to invest in. Zaino is one of the best at find long-forgotten industries as fundamentals are on the upswing. This ogre of an industry appears ready to return some princely profits to shareholder.

Last year I previewed the big-budget summer movies, giving you a look at ten interesting films that were on the docket for the summer of 2006. This year I'm back with an even longer list (bloated like these films' budgets) of 15 movies you may want to escape to -- or possibly run screaming from.

Of these fifteen movies, Spiderman 3 and ten others are sequels, which in itself indicates something about the state of the industry (And I didn't even include Rush Hour 3 in this list, because, honestly, who wants to see that?). Two of the remaining four movies, Transformers and The Simpsons, are based on animated television shows, leaving only two original ideas in the whole lot -- Knocked Up and Ratatouille. Please, don't shoot the messenger.

Anyway, here is the list, chronologically, of the movies that Hollywood's brain-trust believes you will shell out your cash to see in the air-conditioned darkness of your local movie-house, along with my opinion of how they'll fare. The first on the list, Spider-Man 3, is already out in Asia, but will not be released here until May. All release dates below are for the U.S.

5/04 - Spider-Man 3, Sony Corp's (NYSE: SNE) Sony Pictures
Being the first blockbuster of the summer almost guarantees a successful open, and the popularity of the franchise seals that guarantee. One problem, however, is that "success" measured by any normal means won't be enough, as this movie had an estimated budget of $258M.

5/11 - 28 Weeks Later, News Corp's (NYSE: NWS) 20th Century Fox
The highlight of the horror/zombie genre for the summer, this follows the surprise success of Danny Boyle's 28 Days Later, which reinvented the zombie film with faster zombies and smarter characters.

5/18 - Shrek the Third, Viacom's (NYSE: VIA) Paramount Pictures
One of the only cartoon franchises that has held its own against Pixar (Ice Age being the other), the draw of this fairytale romp is that while kids love the story, there are enough winks at the adult audience to make parents happy to take them.

5/25 - Pirates of the Caribbean: At World's End, Walt Disney (NYSE: DIS)
Money in the bank for Disney, and since it was shot simultaneous with the second Pirates installment, it wasn't even as expensive to make as this summer's other budget hog, Spider-Man 3.

Shrek, Dreamworks Animations' (NYSE:DWA) billion-dollar baby, has taken on another job in addition to shilling for McDonald's Happy Meals (NYSE:MCD) -- encouraging America's kids to play off that French-fry tire.

The green meanie with a heart of gold and his cohorts are featured in the U.S. Dept. of Health and Human Service's Smallstep program, aimed at getting children to engage in active play at least an hour a day. His image and the slogan, "Be a player," will be showing up in multiple venues, including as online, billboards and television ads. According to the Wall Street Journal (subscription required), the department has received over $270 million in comp ad placements already.

I can't help but think that the rollout of this program, shortly in advance of the release of Shrek 3 on May 18th, is no coincidence, but a nifty piece of cross-marketing. It helps compensate for the character's pitches for products such as Pepsi and McDonald's Happy Meals, under attack by those concerned about our nation's health.

In fact, I'd suggest expanding the program. When the movie opens, how about requiring that viewers park a few blocks from the theater and walk the rest of the way?