(FORTUNE Magazine) – The Black Cauldron, the latest animated feature from Walt Disney Pictures, netted a respectable $11.5 million at the box office in its first 12 days in U.S. theaters. The $25-million fantasy film, which took five years to complete, is only the third animated feature produced by Disney in the past ten years -- the others were The Rescuers and The Fox and the Hound. Roy Disney, nephew of the company's founder, says the favorable responses from reviewers and theatergoers have confirmed his belief that ''animation is a viable art.'' While reviews have been good, some observers say the film cost way too much and may never turn a profit. But animated features are a hot item in Hollywood, which was skeptical until Nelvana Production's The Care Bears Movie opened in March and grossed more than $20 million in the U.S. Now everybody seems to be on the bandwagon. Margaret Loesch, chief executive of Marvel Productions, a leading producer of animated films for television, estimates that a dozen full-length animated films are in production. Marvel will plunge into the market next year with Transformers, based on the hot-selling Hasbro Bradley toys that convert into robots. However, Michael S. Rosenblatt, vice chairman of Atlantic Releasing, a film distributor and producer, warns that animation is no guarantee of success. Filmation's The Secret of the Sword, based on the popular He-Man and She-Ra action toys and TV show, was disappointing at the theaters. Rosenblatt says the money in animation may be in videotape sales. Most children's films are sold rather than rented because the tykes watch them over and over again. ''You can make money in theaters,'' says Rosenblatt, ''but the big, secure bucks are in videotapes and syndication.''