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AMC Entertainment (AMC) Q1 Earnings: Will it Disappoint?
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Leisure and recreation services company, AMC Entertainment Holdings, Inc. (AMC - Free Report) , is slated to report first-quarter 2017 results on May 8, after market close.
Last quarter, the company delivered a positive earnings surprise of 8.82%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in three of the four trailing quarters, with an average beat of 7.72%.
Let’s see how things are shaping up for this announcement.
Factors at Play
AMC Entertainment is one of the largest theatrical exhibition companies in the U.S., Europe and globally with approximately 1,000 theaters and 11,000 screens across the globe. AMC now operates theaters in 15 countries and is the market leader in nine of those. The company is also an industry leader in innovation and operational excellence.
Further, it has been actively involved in the renovation and refurbishing of multiplexes through enhancements like reclining seats, improved food and beverages, dine-in theaters, and advanced sound and digital equipment. To this end, the company has also rebranded the theaters acquired from its smaller rival, Carmike Cinemas Inc. Opening of the 50th Dolby Cinema at AMC location can be considered a major breakthrough as well.
The recent acquisition of Stockholm-based Nordic Cinema Group Holding AB has boosted AMC’s growth, geographical expansion. Nordic Cinemas is the largest theatre operator in the Nordic and Baltic countries. We believe this deal will lead to significant growth opportunities in key European markets.
Further, IMAX Corporation (IMAX - Free Report) and AMC Theatres’ agreement will bring a new business prospect. The company’s commitment to IMAX increased the number of IMAX theaters by 15% year over year at the end of first-quarter 2017, expanding to 175 locations by Mar 2017 and 185 theatres through 2019.
We also appreciate the company’s efforts to offer a quarterly cash dividend of 20 cents per share on shares of Class A and Class B common stock for the quarter ended Mar 31, 2017. The dividend will be paid on Jun 19, 2017, to shareholders of record on Jun 5, 2017.
Despite such booming prospects, the price performance of AMC Entertainment looks depressing. Over the past three months, shares of AMC Entertainment have decreased 7.9%, underperforming the Zacks categorized Leisure and Recreation Services industry which has witnessed a gain of 10.0%.
However, the new business scheme to be adopted by Hollywood studios (film makers) is a major setback to the movie theater (exhibitor) industry. The strategy involves making newly released movies available for home viewing at a premium within as little as two weeks of screen debut, thus affecting the movie release. Moreover, being part of the entertainment industry exposes the company to macroeconomic fluctuations and intense competition from the likes of Regal Entertainment Group and IMAX Corp. that belong to the same industry.
Earnings Whispers
Our proven model does not conclusively show that AMC Entertainment is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, that is not the case here as elaborated below.
Zacks ESP: AMC Entertainment has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 8 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: AMC Entertainment has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
AMC Entertainment Holdings, Inc. Price and EPS Surprise
Here is a company from the Zacks-categorized broader Consumer Discretionary sector — which houses AMC Entertainment — that has the right combination of elements to post an earnings beat this quarter.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
AMC Entertainment (AMC) Q1 Earnings: Will it Disappoint?
Leisure and recreation services company, AMC Entertainment Holdings, Inc. (AMC - Free Report) , is slated to report first-quarter 2017 results on May 8, after market close.
Last quarter, the company delivered a positive earnings surprise of 8.82%. Moreover, the company’s earnings surpassed the Zacks Consensus Estimate in three of the four trailing quarters, with an average beat of 7.72%.
Let’s see how things are shaping up for this announcement.
Factors at Play
AMC Entertainment is one of the largest theatrical exhibition companies in the U.S., Europe and globally with approximately 1,000 theaters and 11,000 screens across the globe. AMC now operates theaters in 15 countries and is the market leader in nine of those. The company is also an industry leader in innovation and operational excellence.
Further, it has been actively involved in the renovation and refurbishing of multiplexes through enhancements like reclining seats, improved food and beverages, dine-in theaters, and advanced sound and digital equipment. To this end, the company has also rebranded the theaters acquired from its smaller rival, Carmike Cinemas Inc. Opening of the 50th Dolby Cinema at AMC location can be considered a major breakthrough as well.
The recent acquisition of Stockholm-based Nordic Cinema Group Holding AB has boosted AMC’s growth, geographical expansion. Nordic Cinemas is the largest theatre operator in the Nordic and Baltic countries. We believe this deal will lead to significant growth opportunities in key European markets.
Further, IMAX Corporation (IMAX - Free Report) and AMC Theatres’ agreement will bring a new business prospect. The company’s commitment to IMAX increased the number of IMAX theaters by 15% year over year at the end of first-quarter 2017, expanding to 175 locations by Mar 2017 and 185 theatres through 2019.
We also appreciate the company’s efforts to offer a quarterly cash dividend of 20 cents per share on shares of Class A and Class B common stock for the quarter ended Mar 31, 2017. The dividend will be paid on Jun 19, 2017, to shareholders of record on Jun 5, 2017.
Despite such booming prospects, the price performance of AMC Entertainment looks depressing. Over the past three months, shares of AMC Entertainment have decreased 7.9%, underperforming the Zacks categorized Leisure and Recreation Services industry which has witnessed a gain of 10.0%.
However, the new business scheme to be adopted by Hollywood studios (film makers) is a major setback to the movie theater (exhibitor) industry. The strategy involves making newly released movies available for home viewing at a premium within as little as two weeks of screen debut, thus affecting the movie release. Moreover, being part of the entertainment industry exposes the company to macroeconomic fluctuations and intense competition from the likes of Regal Entertainment Group and IMAX Corp. that belong to the same industry.
Earnings Whispers
Our proven model does not conclusively show that AMC Entertainment is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, that is not the case here as elaborated below.
Zacks ESP: AMC Entertainment has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 8 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: AMC Entertainment has a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
AMC Entertainment Holdings, Inc. Price and EPS Surprise
AMC Entertainment Holdings, Inc. Price and EPS Surprise | AMC Entertainment Holdings, Inc. Quote
Stock to Consider
Here is a company from the Zacks-categorized broader Consumer Discretionary sector — which houses AMC Entertainment — that has the right combination of elements to post an earnings beat this quarter.
Tribune Media Company is set to release first-quarter 2017 results on May 10. The company has an Earnings ESP of +28.57% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>