Whether The Stock Price Of Film Companies Correctly Reflects The Box-office Revenue

China’s entertainment industry has developed rapidly in recent years,and the entertainment industry,which is closely related to people’s lives,is the film industry.Since the release of China’s first film work,Ding Jun Mountain,the film industry has developed in China for more than 110 years.Since the 21 st century,domestic films set box office records frequently,and the development of the film industry is no longer the same.Driven by capital,big-budget films with high investment and high box office are emerging in an endless stream.At the same time,the returns brought to investors are not only reflected in the company’s earnings unilaterally,but also reflected in the company’s stock price.To a certain extent,the change in stock price can also indicate the degree of recognition of the film works by the audience.This paper studies the relationship between the box office income of film works and the stock price changes of listed companies.First of all,the samples are divided into three categories according to the level of box office income.The first category is the films with greater influence and its box office income is over 1 billion yuan,the second category is the films with general influence and its box office income is between 500 million to 1 billion yuan,and the third category is the films with less influence and its box office income is between 300 million to 500 million yuan.Secondly,this paper takes the release date of the film as the event occurrence date,then uses the event study method to research how the three types of films with different box office revenues and influences will affect the stock price of relevant companies during the release period.Finally,this paper analyzes the films with high box office revenue and low box office revenue released by Beijing Culture in recent years,and studies the impact of the release of these films on the stock price of Beijing Culture.Through analysis,the following conclusions are drawn: films with a box office of more than 1 billion yuan and great influence will have a significant positive impact on the stock prices of relevant companies during their release.Films with a box office between 500 million yuan and 1 billion yuan have a significant negative impact on the stock price of relevant companies during their release.And those with a box office between 300 million yuan and 500 million yuan had no significant influence on the stock prices of the relevant companies during their release.In addition,this paper found that some influential film works may not only have an impact on the stock prices of relevant companies,but also affect the stock prices of many film companies during their release,causing a general rise in the stock prices of the film industry.Finally,according to the research conclusions,this paper summarizes some suggestions and enlightenment on the development of China’s film market.