Reading International (RDI) AI Stock Analysis

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Reading International

(NASDAQ:RDI)

35Underperform

Reading International's stock faces significant challenges due to poor financial performance, bearish technical indicators, and a weak valuation. While the Q4 earnings call showed some operational improvements, the overall financial health remains concerning, with high debt and negative cash flows. The recovery in Q4 is a positive, but broader financial issues weigh heavily on the stock's outlook.

Reading International (RDI) vs. S&P 500 (SPY)

Market Cap

$36.85M

Dividend YieldN/A

Average Volume (3M)46.40K

Price to Earnings (P/E)―

Beta (1Y)0.38

Revenue Growth-5.48%

EPS Growth-14.32%

CountryUS

Employees2,025

SectorCommunication Services

Sector Strength77

IndustryEntertainment

Share Statistics

EPS (TTM)-1.58

Shares Outstanding20,603,203

10 Day Avg. Volume48,774

30 Day Avg. Volume46,398

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.16

Price to Cash Flow (P/CF)5.90

P/FCF Ratio1.70

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$2.50

Price Target Upside110.08% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Reading International Business Overview & Revenue Model

Company DescriptionReading International (RDI) is a diversified entertainment and real estate company primarily engaged in the development, ownership, and operation of cinemas and live theatres. The company operates across various sectors, including cinema exhibition, live theatre, and real estate development. RDI owns and manages a portfolio of entertainment venues, including multiplex cinemas in the United States, Australia, and New Zealand, as well as live theatres in New York City. Additionally, the company invests in and develops real estate properties with a focus on enhancing the value of its entertainment assets.

How the Company Makes MoneyReading International makes money through several key revenue streams. The primary source of revenue is from its cinema exhibition operations, where it earns income from ticket sales, concessions, and advertising. The company operates numerous cinemas, generating substantial revenue from customers attending movie screenings. Another significant revenue stream is from the operation of live theatres, which includes earnings from ticket sales for theatrical productions and related events. Additionally, RDI generates income from its real estate operations, including leasing space to retail and commercial tenants and developing properties for sale or lease. Strategic partnerships with film distributors, production companies, and other entertainment entities also contribute to its earnings, enhancing its ability to offer a diverse range of entertainment options.

Reading International Financial Statement Overview

Summary

Reading International faces significant financial challenges across all verticals, with declining revenues, high leverage, and negative profit margins. The company's liquidity and operational efficiency are areas of concern, with a need for strategic adjustments to improve financial health and stability.

Income Statement

Negative

Reading International's income statement shows a declining revenue trend with a negative net profit margin in the TTM period. The gross profit margin has significantly decreased, indicating rising costs or declining sales. Negative EBIT and EBITDA margins further highlight operational challenges. The company's revenue growth has been inconsistent, with a notable decline in the latest TTM period.

Balance Sheet

Negative

The balance sheet reflects a high debt-to-equity ratio, showcasing significant leverage which could pose financial risks. Stockholders' equity has decreased substantially, reducing the equity ratio. The return on equity is negative due to sustained losses, indicating inefficiencies in generating returns on shareholders' investments.

Cash Flow

Negative

Operating cash flow is negative, reflecting potential liquidity issues, although free cash flow has slightly improved. The cash flow to net income ratios are unfavorable, suggesting difficulties in converting income into cash flow. However, the company has managed to reduce capital expenditures, slightly aiding free cash flow.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
197.27M	222.74M	203.12M	139.06M	77.86M	276.77M
	Gross Profit
1.02M	26.56M	15.40M	6.05M	-21.78M	57.27M
	EBIT
-19.09M	-12.03M	-19.85M	-41.79M	-61.31M	9.12M
	EBITDA
-2.30M	9.12M	1.40M	100.34M	-17.80M	32.99M
	Net Income Common Stockholders
-41.87M	-30.67M	-36.66M	31.92M	-65.86M	-26.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
29.94M	13.17M	29.96M	83.25M	26.85M	12.13M
	Total Assets
405.38M	533.05M	587.05M	687.70M	690.17M	674.99M
	Total Debt
226.94M	418.77M	443.61M	481.09M	524.14M	450.56M
	Net Debt
200.39M	405.87M	413.66M	397.84M	497.31M	438.42M
	Total Liabilities
293.69M	500.06M	523.78M	582.64M	609.00M	535.37M
	Stockholders Equity
110.40M	33.09M	62.86M	104.07M	77.77M	135.35M
Cash Flow		Free Cash Flow
-15.76M	-15.08M	-35.74M	-29.05M	-48.73M	-21.10M
	Operating Cash Flow
-15.55M	-9.73M	-26.35M	-13.50M	-30.20M	24.61M
	Investing Cash Flow
8.48M	-2.70M	-9.49M	129.61M	-18.77M	-51.93M
	Financing Cash Flow
-289.00K	-6.67M	-16.56M	-50.28M	59.33M	26.01M

Reading International Technical Analysis

Technical Analysis Sentiment

Negative

Last Price1.19

Price Trends

50DMA

1.40

Negative

100DMA

1.43

Negative

200DMA

1.49

Negative

Market Momentum

MACD

-0.02

Negative

RSI

50.20

Neutral

STOCH

24.67

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RDI, the sentiment is Negative. The current price of 1.19 is below the 20-day moving average (MA) of 1.32, below the 50-day MA of 1.40, and below the 200-day MA of 1.49, indicating a bearish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 50.20 is Neutral, neither overbought nor oversold. The STOCH value of 24.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RDI.

Reading International Risk Analysis

Reading International disclosed 9 risk factors in its most recent earnings report. Reading International reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Reading International Peers Comparison

Overall Rating

UnderperformOutperform

Sector (58)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EPR	74 Outperform	$3.58B	29.36	6.11%	7.42%	-1.01%	-18.46%
IMAX	69 Neutral	$1.17B	44.45	9.10%	―	-6.04%	6.43%
CNK	66 Neutral	$3.16B	13.03	67.31%	0.30%	-0.56%	63.92%
Sector *	58 Neutral	$25.97B	3.12	-10.67%	4.37%	2.16%	-43.01%
NCMI	50 Neutral	$564.49M	―	-5.27%	0.53%	45.67%	-100.72%
AMC	50 Neutral	$1.25B	―	20.03%	―	-3.64%	48.94%
RDI	35 Underperform	$36.85M	―	-245.80%	―	-5.48%	-14.32%

* Communication Services Sector Average

Performance Comparison

RDI

Reading International

1.19

-0.64

-34.97%

CNK

Cinemark Holdings

27.93

10.20

57.53%

IMAX

21.44

5.01

30.49%

NCMI

National Cinemedia

5.77

1.07

22.77%

EPR

EPR Properties

47.23

9.49

25.15%

AMC

AMC Entertainment

2.95

0.30

11.32%

Reading International Earnings Call Summary

Earnings Call Date: Mar 31, 2025 | % Change Since: -4.80% | Next Earnings Date: May 19, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted a strong recovery in the fourth quarter of 2024, with significant improvements in revenue and EBITDA driven by a robust film slate and effective cost management. However, the full-year results were impacted by external challenges such as the 2023 Hollywood strikes, resulting in a decline in total revenue and increased net loss. Efforts to reduce debt and monetize real estate assets were positive steps towards improving financial stability.

Highlights

Strong Fourth Quarter Performance

Q4 2024 global total revenue was $58.6 million, a 29% increase from Q4 2023, marking the best fourth quarter since Q4 2019. Adjusted EBITDA increased over 400%, reaching $6.8 million.

Improved Cinema and Real Estate Segments

Global cinema revenue for Q4 2024 was $54.6 million, a 30% increase from Q4 2023. Global real estate revenue increased by 14% in Q4 2024, with a notable 148% increase in operating income.

Effective Cost Management

Reduction in net cash used in operating activities by $5.9 million in 2024. Efforts to monetize real estate assets, including the sale of the Culver City office for $10 million and property assets in Wellington, NZ.

Successful Debt Reduction Initiatives

Reduction of outstanding borrowings to $202.7 million by the end of 2024, down from $210.3 million at the end of 2023, aided by real estate sales and refinancing efforts.

Record High Food and Beverage Spend Per Patron (F&B SPP)

For the full year 2024, F&B SPP reached record highs in all cinema divisions, contributing to improved financial performance.

Lowlights

Full-Year Revenue Decline

Total revenue for 2024 was $210.5 million, a 5% decrease from 2023, largely impacted by the 2023 Hollywood strikes and resultant release date shifts.

Increased Net Loss for Full Year

Net loss for 2024 increased by $4.6 million to $35.3 million compared to 2023, with a basic loss per share rising to $1.58 from $1.38.

Impact of Cinema Closures

Closure of underperforming cinemas in the U.S. and New Zealand, impacting gross revenue but expected to benefit future profitability.

Challenges in Box Office Recovery

2024 global cinema revenue was 6% less than 2023, reflecting ongoing challenges in returning to pre-pandemic levels.

Interest Rate and Debt Challenges

Increased interest expense by $1.7 million due to rising interest rates, impacting overall financial performance.

Company Guidance

During the Reading International's Fourth Quarter 2024 Earnings Call, the company provided guidance highlighting significant improvements across key operational metrics compared to the previous year. The Q4 2024 global total revenue was $58.6 million, marking a 29% increase from Q4 2023, the best since Q4 2019. Global operating income rose by 122% to $1.5 million, and adjusted EBITDA surged by over 400% to $6.8 million. The global cinema revenue reached $54.6 million, a 30% rise from Q4 2023, while global real estate revenues increased by 14% to $5.2 million. The company emphasized strategic initiatives, including asset monetization and debt reduction, aiming to enhance liquidity. Looking forward, Reading International anticipates exciting movie lineups in 2025 to boost its cinema business, despite facing challenges such as the impacts of the 2023 Hollywood strikes. The company also plans to upgrade theaters in several locations and continues to explore opportunities for asset sales to further strengthen its financial position.

Reading International Corporate Events

Shareholder MeetingsBusiness Operations and Strategy

Reading International Holds Successful 2024 Annual Meeting

Positive

Dec 10, 2024

Reading International, Inc. held its 2024 Annual Meeting, where stockholders approved an amendment to increase shares under the 2020 Stock Plan, elected directors, ratified the appointment of Grant Thornton LLP as the independent auditor, and approved executive compensation. These decisions are aimed at supporting the company’s liquidity and operational strategies, reflecting Reading International’s commitment to maintaining and enhancing its industry position and financial performance.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.