Shares of AMC Entertainment Holdings, Inc. (AMC) jumped 19.1% on Friday, as its theatres witnessed the largest attendance in the U.S. for the movie SPIDER-MAN: NO WAY HOME. The movie broke all box office records in AMC’s history, with the single highest-grossing movie title on its opening night, in December.
A favorite of the WallStreetBets Stocks, AMC shares closed at $29.12 on December 17. Its shares have been highly volatile since the start of the pandemic and have lost 47.7% in the past six months, against a gain of 986.6% over the past year.
Blockbuster Night
According to AMC, approximately 1.1 million movie fans watched the latest Spider-Man flick on its opening night across its theatres in the U.S. This was the highest number of people to watch a movie on a single night in both 2020 and 2021. Attendance for Spider-Man across its theatres in Europe, the Middle East, and the rest of the world was also strong.
Friday marked the second highest-grossing night for AMC theatres following AVENGERS: ENDGAME which was released in 2019.
Earlier, AMC had announced that it had the biggest single-day ticket sale for SPIDER-MAN: NO WAY HOME on November 29, 2021, when they started selling its tickets. The theatre said that it had reached almost 99% of the all-time high record ticket sales set by AVENGERS: ENDGAME in 2019.
Management Comments
AMC Chairman and CEO, Adam Aron, said, “Needless to say, we are ever so happy to see a record-setting number of people returning to the cinema to capture the magic offered at AMC movie theatres… Yesterday for its opening night, we hosted some 1.1 million guests to watch SPIDER-MAN: NO WAY HOME at our U.S. theatres. Our congratulations go to Sony Pictures for this wonderfully successful new movie.”
Aron concluded, “Spider-Man clearly indicates to us that consumers in large numbers desire the experience that only AMC theatres can provide, and our amazing theatre teams were prepared for the moment.”
Analysts’ Take
Responding to AMC’s blockbuster weekend performance, B. Riley Securities analyst Eric Wold maintained a Hold rating on the stock with a price target of $16, which implies 45.1% downside potential to current levels.
Wold has a positive outlook on AMC’s competitors and said, “With exclusive theatrical windows proving their importance to the industry (both studios and exhibitors), we feel this presents an extremely attractive set-up heading into next year’s slate.”
However, the analyst is cautious about AMC as he believes there is a lurking risk of the theatre becoming bankrupt. He goes on to state that should the company not be able to secure additional financing during the extended shutdown period, AMC might be forced to file for bankruptcy.
Overall, the stock has a Moderate Sell rating with 2 Holds and 2 Sells. The average AMC Entertainment price target of $8.17 implies a whopping 71.9% downside potential to current levels.
Bloggers
TipRanks data shows that financial blogger opinions are 64% Bearish on AMC, compared to a sector average of 67%.
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