Pixar’s Deal Animates Collectors
Pixar Animation Studios Inc.’s upcoming sale to Walt Disney Co. has inspired an audience of investors more interested in buying a piece of paper than a piece of the $7.4-billion deal.
All these people want is one of Pixar’s stock certificates, the commemorative scrolls given to shareholders of the computer animation pioneer behind such hit movies as “Toy Story” and “The Incredibles.”
Once Disney absorbs the company this spring, Pixar will stop issuing the colorful certificates decorated with “Toy Story” stars Buzz Lightyear and Woody -- just one of the reasons this particular piece of paper is so treasured.
“It’s like a piece of art,” said Brian Giboney, who recently added Pixar to his collection of stock certificates from about 100 companies. “And it’s not something that you are going to be able to buy down the road.”
Giboney, 35, keeps his Pixar certificate in a safe place, just like the rest of his collection, because he believes that the documents will get more valuable as computer databases increasingly replace paper records of stock ownership.
He prizes them so much that he asked that his home city not be identified to thwart potential thieves.
Other people, such as San Francisco resident Lily Chang, want a Pixar certificate for emotional reasons.
She bought five Pixar shares shortly after the Jan. 24 announcement of the Disney sale just so she could get a stock certificate, which she tucked into an old college textbook to get the wrinkles out.
“I feel like a dork because it feels a bit obsessive,” said Chang, 36, who once dreamed of working for Pixar. “I am never going to be selling this on EBay, though. You can’t put a price on sentiment.”
With the Disney deal looming, many people are buying just a single Pixar share because that’s the least expensive way to get certificates before they become defunct.
Pixar’s stock price recently has been hovering around $65, but getting a certificate costs an additional $35 to $40 at places such as OneShare.com and Frame-a-Stock Inc., which specialize in the service. Throw in the frame that many people have been buying to memorialize the certificates and the total cost approaches $150.
That hasn’t scared off buyers at San Francisco-based OneShare, where orders for Pixar certificates are running 35 times higher than at the same time last year.
“It’s been like Christmas all over again for us,” said Byron Beach, OneShare’s vice president of marketing.
Pixar sales have tripled at Frame-a-Stock, and the Fort Myers, Fla. company expects demand to accelerate further as it steps up its promotions in the next month, President Tim Stockton said.
Stock certificates used to be the standard way of denoting ownership in a publicly held company, but that has changed dramatically as the securities industry shifted to electronic recordkeeping to reduce costs.
The Depository Trust & Clearing Corp., which settles most U.S. stock trades, now has just 3.4 million stock certificates in its vaults, down from roughly 30 million in 1990.
Certificates are expected to become even more rare with recent legal changes in Delaware, where more than half the nation’s publicly traded companies are incorporated because of the state’s favorable business rules. Delaware has dropped a requirement forcing companies to issue stock certificates, making the choice optional.
The rise of paperless recordkeeping is helping to popularize scripophily -- the practice of collecting old stock and bond certificates.
Some collectors are in it strictly for the money, hoping to come across something as valuable as vintage Standard Oil Co. certificates issued in the 19th century.
Some of Standard Oil’s 1873 certificates, signed by John D. Rockefeller, have fetched $8,500 to $130,000, said Bob Kerstein, who runs Scripophily.com, which has become a magnet for collectors.
Other collectors are just looking for a memento that sums up a particular era. That’s one reason the stock certificates of Enron Corp. -- an emblem of corporate scandal -- were recently listed on Scripophily for prices ranging from $49.95 to $375. Enron’s stock disintegrated in late 2001, when the company went bankrupt.
It also helps to have a flashy certificate. That factor seems to be driving demand for EToys Inc., a relic of the dot-com boom that went bankrupt in 2001. The once-high-priced stock’s ornate certificate, featuring toys alongside its red-and-blue logo, commands $125 to $250.
Even before the Disney sale, Pixar was among a handful of companies whose stock certificates have been perennial favorites. Other high-demand certificates include Harley-Davidson Inc., Ford Motor Co., DreamWorks Animation SKG Inc., Tiffany & Co., Coca-Cola Co., Starbucks Inc., Microsoft Inc. and Apple Computer Inc.
Except for a few brief periods, Disney’s stock certificate has been the top seller at OneShare since former bond trader Lance Lee started the company a decade ago. OneShare has sold more than $20 million in stock, Lee said.
Disney’s certificates are adorned with drawings of Mickey Mouse, Tinkerbell and other pop culture icons, making the documents popular ideas for parents and grandparents shopping for children’s gifts with an investment twist. Because Disney is buying Pixar with its own stock, Pixar shareholders will be eligible to receive a Disney certificate after the acquisition is completed.
Pixar supplanted Disney as OneShare’s most popular certificate as soon as the sale was announced in January, Beach said. It’s the longest stretch that any company besides Disney has topped OneShare’s sales charts, which didn’t surprise Lee.
“If you are a Pixar fan,” Lee said, “there’s something a lot more substantial about buying the company’s stock certificate instead of getting some figurine of a character in one of Pixar’s movies.”
