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What Does Disney World's Top Rival Have Up Its Sleeve?

There is less to do at Comcast's (NASDAQ: CMCSA) Universal Studios Florida these days. The movie-themed park closed Shrek 4D -- a 3D show with in-theater effects based on the popular Shrek franchise -- over the weekend. It's not coming back, and it will inevitably be replaced by a new guest experience. Earlier this month, the park closed Revenge of the Mummy for refurbishment that will take more than half a year to complete. Signs at the park indicate that it will open in late summer this year.

Rides get replaced, and older rides need to be updated. However, taking down two attractions near the same area of the park at roughly the same time is going to create capacity constraints at the Universal Orlando resort. It may not seem to matter much right now. We're past the industry's peak two-week holiday travel season. Comcast, rival Disney (NYSE: DIS), and the companies responsible for the rest of the country's year-round gated attractions will see crowds dwindle through the next two months. Seasonality is clearly why Comcast timed the closure of one attraction and a prolonged refurbishment of the other to take place earlier this month. However, it could be a problem once schools start to let out for spring break in March and April. Things will definitely be problematic if Revenge of the Mummy isn't ahead of schedule and able to reopen by the time summer guests start to arrive, especially since whatever replaces Shrek 4D isn't likely to be completed anytime soon.

What's Comcast doing? Will Disney take advantage of the lull at its largest competitor? With the omicron variant surging, is it convenient timing for Universal Orlando to be restocking its ammo for kinder times? Let's take a closer look.

Image source: Universal Orlando.

Seeing green

The decision to close Shrek 4D should be considered in context. The original Shrek movie was a box office smash when it hit the multiplex in 2001. Universal struck a deal with the film's studio -- DreamWorks Animation -- to open the new attraction a year later. Comcast didn't own Universal at the time. That deal wouldn't happen until a decade later. Comcast would go on to acquire DreamWorks Animation in 2016.

Comcast's owning DreamWorks Animation would seem to make Shrek 4D a permanent fixture at the park. It also bears noting that 2004's Shrek 2 continues to be the highest-grossing film domestically that wasn't Disney's handiwork. However, the franchise hasn't aged as well as some of the studio's subsequent films. The Shrek 4D attraction always received mixed reviews beyond first-time visitors to the park.

A change makes sense, but what is coming? Universal Orlando's social media team has been teasing what will happen next. It's been posting photos of peeled bananas and even banana plants near the site of Shrek 4D. Is Comcast going bananas?

Ok, who did this? 🤔 pic.twitter.com/hmY5ydomDm

— Universal Orlando Resort (@UniversalORL)

The presence of bananas has folks on social media hovering around three potential replacements. The most popular theory is that a Minions-themed expansion is in the works. The banana-obsessed minions from Despicable Me and now their own franchise already have an attraction across from Shrek 4D, but it wouldn't be strange for Comcast to expand the area to cash in on one of its hottest family-friendly properties with a new experience.

Those hoping for nostalgia point to King Kong. One of the park's early attractions was Kongfrontation, where guests would board the Roosevelt Island Tramway and come face-to-face with the ape. Throwback fans won't be getting an old attraction brought back, as that doesn't happen often in the forward-looking theme park industry. A new Kong attraction may seem like an odd choice since the resort's adjacent Islands of Adventure park opened a King Kong ride a couple of years ago. But stranger things have happened.

The third theory is that a Donkey Kong ride is coming. Universal is teaming up with Nintendo (OTC: NTDOY) to open Super Nintendo World across many of its parks, but that land was slated to be a part of the Epic Universe that was initially set to open in 2023 or 2024. A COVID-19-related construction delay has now pushed the new Universal Orlando park to open potentially as late as 2025. Is that prompting Comcast to give Orlando visitors an earlier taste of the future to come -- in a way promoting the upcoming theme park?

We will find out soon, once the Universal Orlando social media team peels the banana. Right now, it's not front and center. The surge in COVID-19 cases -- particularly in Florida -- will weigh on the state's leisure stocks, which include cruise line and theme park businesses. With Disney generating most of the buzz anyway until early 2023 with its 18-month celebration of the resort turning 50, it makes sense for Universal to sit 2022 out if it means having something better to offer by the springtime of 2023, when Disney will quiet down.

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Rick Munarriz owns Walt Disney. The Motley Fool owns and recommends Walt Disney. The Motley Fool recommends Comcast and Nintendo and recommends the following options: long January 2024 $145 calls on Walt Disney and short January 2024 $155 calls on Walt Disney. The Motley Fool has a disclosure policy.


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