TLDR
- AMC stock jumped 9.4% to $3.48 on Thursday, marking its highest closing price since May 30
- Benchmark analyst Mike Hickey raised earnings forecasts, citing rising moviegoing demand and box-office rebound
- Summer ticket sales have surpassed last year’s totals by 16.5%, with domestic box office revenue up 15% year-over-year
- Wedbush upgraded AMC from neutral to outperform, raising price target from $3 to $4
- The company will report second-quarter earnings on August 8, with analysts expecting revenue of $1.3 billion
AMC Entertainment Holdings stock has been on a tear lately, climbing nearly 25% over the past three months. The theater chain’s shares surged 9.4% to $3.48 on Thursday, reaching their highest closing price since May 30.
The rally comes as Wall Street analysts grow more optimistic about the company’s prospects. Benchmark analyst Mike Hickey raised his earnings forecast for the movie chain, pointing to what he calls “outsized potential upside.”
Hickey expects rising moviegoing demand and this year’s box-office rebound to drive visitors back to theaters. He also praised AMC’s focus on customer loyalty through membership programs and premium screens like IMAX.
“The exhibition landscape is showing signs of stabilization following pandemic and Hollywood strike disruptions,” Hickey wrote in his research note. He maintained a Hold rating on the stock.
The numbers seem to back up his optimism. Summer blockbusters like Superman, F1 and Jurassic World Rebirth have pushed ticket sales 16.5% higher than last year’s totals, according to Comscore data.
Box Office Recovery Gains Steam
Total domestic box office revenue has reached $4.7 billion so far this year. That’s 15% higher than the same period last year, showing real momentum in the recovery.
Hickey now anticipates AMC’s domestic ticket sales will jump 37% year-over-year in the second quarter. That’s well above his previous estimate of just 12.5%.
He also bumped up his revenue forecast to $1.3 billion, up from his earlier call for $1.1 billion. For context, AMC reported $862.5 million in revenue last quarter, down from $951.4 million in the prior year’s first quarter.
The company is set to report its second-quarter earnings before markets open on August 8. Investors will be watching closely to see if the box office recovery translates to AMC’s bottom line.
Wall Street Gets More Bullish
Benchmark isn’t the only firm getting more upbeat about AMC. Wedbush analyst Michael Pachter upgraded the stock from neutral to outperform on Friday, raising his 12-month price target from $3 to $4.
Pachter cited an upcoming film release schedule that’s more consistent than recent years. He also pointed to AMC’s lead in premium screens in North America as a competitive advantage.
The analyst was impressed with AMC’s cost-cutting efforts, including closing underperforming theaters. These moves have helped boost the bottom line and reduce debt.
Wedbush’s upgrade marked the first rating equivalent to Buy in more than five years for AMC. That’s a telling sign of how sentiment has shifted.
The theater chain is also expanding internationally, with plans in the U.K. and European Union. This geographic diversification could provide new growth opportunities.
Coming releases like Smurfs and The Fantastic Four: First Steps represent tried-and-true franchises likely to draw audiences. These types of proven properties have historically performed well at the box office.
However, challenges remain for the theater industry. In 2024, roughly 760 million movie tickets were sold in the U.S., down from 1.2 billion before the pandemic. That’s also well below the 1.4 billion tickets sold annually in the late 1990s and early 2000s.
AMC’s balance sheet shows negative equity approaching $2 billion, and the company has struggled with profitability for years. Despite the recent analyst upgrades and box office recovery, these fundamental challenges haven’t disappeared.
The stock closed Friday up 10.6% at $3.32, with the S&P 500 down about 0.2% for the session.
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