Following a year of downtime for Hollywood movie production and screening, AMC is finally reopening in the town where it makes its money!
Cinemas need audiences to survive, and AMC Entertainment (NYSE: AMC) — America’s largest cinema operator — needs a lot of butts in seats. News of reopenings in Los Angeles was greeted with joy today as cineplexes in Burbank and Century City were reopened to the public.
L.A. is one of AMC’s most critical markets and the fact that the reopenings come just a day after the Academy Awards nominations were released won’t do it any harm either. Investors appear to agree, as AMC shares soared 26% in anticipation of the reopening, and are up once more in pre-market trading at time of writing.
Just look at our returns versus that of the S&P 500! Click here to find out how we continue to beat the market and view the list of stocks we think will turn out to be the next Amazon, Tesla, or Netflix!
Should I buy AMC stock?
Cinema might not be dead yet, but it’s definitely on life support. AMC happens to be faring better than most though, judging by its Q4 earnings:
- Revenue of $162.5 million and losses per share of $3.15 — both exceeding expectations.
- It secured $1 billion+ in concessions from creditors and raised more than $80 million in asset sales.
- 90% of its theaters have now reopened globally.
Cinema will continue to be a risky investment, even after COVID-19 passes, but AMC is positioning itself well to become the last-chain-standing when the dust settles, and could perhaps lap up some market share from the demise of others.
Read more about AMC below:
A MyWallSt subscription gives you access to over 100 market-beating stock picks and the research to back them up. Our analyst team post daily insights, subscriber-only podcasts and the headlines that move the market. Get your free access now!
MyWallSt operates a full disclosure policy. MyWallSt staff currently holds long positions in companies mentioned above. Read our full disclosure policy here.