Wedbush’s Michael Pachter expects AMC Entertainment Holdings Inc (NYSE: AMC) to see “a little noise” through 2017, since it will be a transition year as the
company renovates theaters and completes and integrates acquisitions.
The analyst maintained an Outperform rating on the company, with a price target of $41.
Accretion From Acquisitions
Pachter expects EBITDA growth for 2017 at more than $300 million, half of which is expected from the integration of Carmike
Cinemas, Inc. (NASDAQ: CKEC) and the rest to be
contributed by Odeon and robust box office growth, as well as synergies.
The Nordic acquisition is also expected to be accretive during the year.
EBITDA growth is expected again for AMC
Entertainment again in 2018, “driven by theater upgrades, segmenting of theaters into upscale and mid-tier brands, further cost
synergies and growth in average ticket price and concessions,” Pachter stated.
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Strong Q4
The company reported strong Q4 results,
at or above the preannouncement and the expectations.
AMC Entertainment reported revenue of $926 million, ahead of the estimate and at the high end of the preannounced range, with
adjusted EBITDA of $189 million, again ahead of the estimate as well as the preannounced range.
EPS for Q4 came in at $0.33, a penny short of the estimate and in line with the preannouncement.
However, admissions revenue per average screen decline 9.6 percent, as compared to the industry decline of 3.5 percent, “with
the delta driven by a tough comparison, lower attendance, and lower average ticket at the Starplex and Carmike circuits,” the
analyst explained.
“This quarter’s strong results in the face of a difficult box office comparison and average ticket headwinds from acquired
circuits highlight the strength of AMC’s model, and the impact of upgraded seating, concessions, and a revamped loyalty program,”
Pachter went on to say.
Latest Ratings for AMC
Date |
Firm |
Action |
From |
To |
Feb 2017 |
Credit Suisse |
Downgrades |
Outperform |
Neutral |
Jan 2017 |
FBR Capital |
Downgrades |
Outperform |
Market Perform |
Dec 2016 |
Goldman Sachs |
Reinstates |
|
Neutral |
View More Analyst Ratings for
AMC
View the Latest Analyst Ratings
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