AMC Entertainment Holdings Inc. (AMC) has been mauled by the bear during the fourth quarter stock market rout along with the broader indices. Despite a record-breaking year at the box office for 2018, AMC saw its stock plummet from ~$20 to ~$12 per share or shedding 40% of its market value. The stock currently sits at ~$13.50 or still over 30% off its 52-week high representing a compelling buy in the backdrop of a record-setting year at the box office, robust slate of movies for 2019, rapidly growing loyalty program with over 600,000 members, a strong consumer, dividend yield of over 5% and accelerating revenue and EPS growth. AMC is reengaging the consumer via digital, mobile and loyalty program options, reformatting theaters to enhance the user experience and international expansion augmented by a healthy share buyback program.
Furthermore, AMC has established relationships with Facebook (FB) and Groupon (GRPN) to drive ticket sales to AMC theaters. The stock looks very attractive considering its depressed valuation, industry strength forecasted through 2019 coupled with a slew of company initiatives to drive the consumer experience. The long term growth narrative remains intact while revenue continues to grow at a healthy clip.
AMC Continues Improving Business – Q3 Earnings
AMC has been establishing firm footing of improving fundamentals across the entire enterprise which were highlighted during its latest earnings announcement for Q3 2018. For the first none months ending September 30th, total revenues increased 10.5% to $4,047.5 million. Admissions revenues grew 8.2% to $2,522.7 million while attendance increased globally by 4.1% and increased by 6.4% in the U.S. Food and beverage revenues increased 9.1% to $1,236.4 million and other revenues increased 46.5% to $288.4 million. AMC is poised to post company records for the full year 2018 in all revenue categories: admissions, food and beverage and other. Continue reading "Bear Market Takes Down AMC - Buying Opportunity?"