AMC Stock On Watch For Q1 Earnings: Estimates, What Analysts Expect, Will Box Office Recover?

Zinger Key Points
  • AMC stock could be volatile with Q1 earnings on tap for Wednesday.
  • The first quarter box office was weaker than last year, which could movie theater stocks like AMC.

Movie theater operator AMC Entertainment Holdings AMC will report first-quarter financial results after the market closes on Wednesday, May 8.

Here are the key earnings estimates, what analysts are saying and key items for investors to watch.

Earnings Estimates: Analysts expect AMC to report first-quarter revenue of $871 million, according to data from Benzinga Pro.

The company reported revenue of $954.4 million in last year's first quarter. AMC has beaten revenue estimates from analysts in 11 straight quarters.

The estimate of $871 million would mark the lowest quarterly revenue by AMC since the first quarter of 2022.

Analysts expect AMC to report a loss of 79 cents per share in the first quarter, compared to a loss of $1.30 per share in last year's first quarter.

The company pre-announced first-quarter revenue of $951.4 million recently. The company said it expects to report a loss of 62 cents per share for the first quarter.

Related Link: AMC Entertainment Q4 Earnings Highlights: Revenue Beat, EPS Beat, ‘Stunning’ Results From Taylor Swift, Beyonce Films

What Analysts Are Saying: Market share gains and growth potential in Europe are overshadowed by high debt levels and a lack of dividend, Wedbush analyst Alicia Reese recently said.

The analyst, who has a Neutral rating and $4 price target, said rising expenses also factor into the company's storyline.

"AMC expanded its market share in 2023 and can expand further from its 22.5% market share with its vast network of premium large-format screens and concert movie distribution," Reese said.

Theater upgrades in Europe could increase per-screen average, the analyst said. The analyst said this may not happen until the balance sheet improves.

"The company's heavy debt load and lack of dividends overshadow these positive factors, but AMC is focused on alleviating its debt."

Reese said the company must chip away at $3 billion in debt repayments "coming due over the next three years."

Key Items To Watch: Box office results and upcoming releases could be among the top items to watch.

The company is optimistic for the second half of the year. However, AMC expressed concerns that the Hollywood Strikes from 2023 would continue to impact the second-quarter box office.

Data from BoxOfficeMojo shows the first quarter domestic box office totaling $1.61 billion, which was down 6.6% year-over-year.

"We are ebullient about the upcoming film slate, and we expect to see an increasingly strong box office as the year progresses," the company said.

Total box office from January to February was down 45% compared to the same months in 2020.

The winter 2024 box office, which includes January, February and a portion of March was down 21.6% year-over-year according to data from BoxOfficeMojo

The two biggest movie releases by domestic box office happened in early March outside of the winter box office season.

Another item to watch will be whether CEO Adam Aron addresses AMC’s high debt levels and any financing updates.

Price Action: AMC stock trades at $3.19 versus a 52-week trading range of $2.38 to $54.97. AMC stock is down 94% over the last year and down 48% year-to-date in 2024.

Read Next: Global Box Office 2024 To Decline 5% In 2023: Bad News For AMC, Cinemark?

Image: Shutterstock

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