MW AMC enjoying box-office 'outperformance' amid post-pandemic recovery, says B. Riley
By James Rogers
Movie-theater chain and original meme stock AMC reported preliminary first-quarter results last week
AMC Entertainment Holdings Inc. is reaping the benefits of a post-pandemic box recovery, according to analyst firm B. Riley Securities.
The company's recent first-quarter preliminary results "demonstrate the exhibitor's continued industry box office outperformance in the post-pandemic recovery era," B. Riley analyst Eric Wold wrote in a note released Monday.
The movie-theater chain and original meme stock's first-quarter revenue of $951.4 million was well above B. Riley's estimate of $878 million, Wold added. "Although AMC only reported total preliminary results without any breakdown between domestic and international revenues, we expect the full results to highlight continued industry box office outperformance," he wrote. Strong box office performance at Imax Corp. (IMAX) is also expected to drive positive share gains for AMC $(AMC)$, which operates 51% of the Imax screens in the U.S., according to Wold.
Related: AMC takes a hit from Hollywood strikes but narrows quarterly loss
In a statement released with AMC's preliminary results, CEO Adam Aron cited the effects of last year's Hollywood writers and actors strikes, but said that the company outperformed.
"I am very pleased to relay to you that our financial results were stronger than consensus analysts estimates," he wrote on social-media platform X, formerly known as Twitter. "I will have much more to say on our May 8 earnings call."
B. Riley maintained its neutral rating and $8 price target for AMC. Of seven analysts surveyed by FactSet, four have a hold rating and three have a sell rating for AMC.
AMC's debt burden is also in the spotlight ahead of its full first-quarter results next week. "We would not be surprised if the late Friday pre-announcement was necessary if the company is having discussions with debt holders to push out some maturity dates and planned to share these financial results," wrote B. Riley's Wold.
Last week, Bloomberg reported that a lender group to AMC advised by law firm Gibson Dunn & Crutcher has made a proposal to the company that would push back its near-term debt maturities.
Related: AMC debt extension would be 'key' as company looks to clean up balance sheet, says Wedbush
In a note released last week, analyst firm Wedbush said the move could be important as AMC looks to tackle its $4.5 billion in debt, $2.9 billion of which is coming due in 2026.
AMC shares rose 0.5% Thursday, compared with the S&P 500 index's decline of 0.07%. The stock, which hit a series of record lows earlier this year, has fallen 51.2% in 2024, compared with the S&P 500 index's SPX gain of 5.1%.
Late Wednesday Aron lauded Hollywood star and AMC brand ambassador Nicole Kidman, who was honored with an American Film Institute Life Achievement Award last weekend.
Related: AMC poised for market-share gains, boosted by premium screens and concert movies, Wedbush says
"And the princess of the ball was our very own Nicole Kidman, the First Lady of AMC," he wrote on X. "What a uniquely talented and accomplished ambassador for AMC and Odeon!"
-James Rogers
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May 02, 2024 10:27 ET (14:27 GMT)
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