Why IMAX Is MKM Partners' Top Idea For 2015: U.S. Box Office And China

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In a report published Thursday, MKM Partners analyst Eric Handler reiterated a Buy rating and price target of $50 on
IMAX Corporation (USA)
IMAX
. The analyst listed the stock as the Top Idea for 2015, while mentioning that the current weakness offers an attractive buying opportunity, given the strong financial outlook for the company. "We see a strengthening financial outlook following a record 2Q15 global box office and believe IMAX is on track to achieve all-time highs for revenue, EBITDA and margins. The recent pullback in IMAX shares is largely due to the decline in Mainland China's stock market," analyst Handler explained. The recent sell-off offers a buying opportunity, given the robust global fundamental outlook for the company, as well as IMAX China continuing to be on track for its Hong Kong IPO during late summer 2015, the rising cash balance that is likely to lead to larger returns for shareholders and the possibility of in-home distribution. The 2Q15 estimates have been raised, largely above the consensus forecasts, driven by the legal costs associated with the Hong Kong IPO being pushed forward, expectations of strong box office revenue in China, as well as meaningful revenue per screen growth in North America and the international markets.
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Posted In: Analyst ColorReiterationAnalyst RatingsMKM Partners
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