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Imax Corp (IMAX) Down 15.6% Since Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Imax Corporation (IMAX - Free Report) . Shares have lost about 15.6% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
First Quarter Earnings
IMAX reported break-even earnings per share in the first quarter, which compared favorably with the Zacks Consensus Estimate of a loss of $0.01. IMAX’s earnings per share in the first quarter of 2016 stood at $0.14. Total revenue in the first quarter of 2017 was $68.7 million, down 25.48% year over year. The figure also missed the Zacks Consensus Estimate of $71.1 million. Adjusted EBITDA margin in the reported quarter was 29.5%. Category wise, equipment and product revenues were $11.5 million, down 51.4%. Services revenues totaled $38.8 million, down 12.26%. Rentals revenues totaled $15.8 million, down 27.19%, while Financial income was $2.4 million, up marginally.
Segmental Results
IMAX Theater Business generated revenues of $23.2 million down 33.8% year over year. Within this segment, IMAX system sales and sales-type leases were $6.9 million, down 61.43%. Ongoing fees and finance income was $2.5 million, down 3.4%. Meanwhile, Joint revenue sharing arrangements-fixed fees was $0.5 million, down 77.3%. Theater system maintenance was $11 million, up 12.41%, while Other Theatre revenues fell 13% to $2.2 million. Network Business generated revenues of $39.3 million, down 24.8% year over year. Within this segment, IMAX DMR was $23.4 million, down 21.5%. Joint revenue sharing arrangements-contingent rent was $15.2 million, reflecting a decline of 28.5% and IMAX systems-contingent rent deteriorated 42% to $0.7 million. Other segments generated revenues of $4.8 million, down 1.62% year over year. Within this segment, Film distribution and post-production was $3.6 million, up 29.4%, and Other revenues were down 37% to $1.2 million. IMAX exited the first quarter with cash and cash equivalents of $190.5 million, compared with $204.7 million at the end of 2016.
Network Growth Statistics
The company installed 15 theaters (including 1 upgrade) as against 19 (including 9 upgrades) in the first quarter of 2016. The company signed 39 theatre agreements in the first quarter of 2017 compared with 36 in the year-earlier quarter. As of Mar 31, 2017, total theater count in backlog was 524 compared with 388 as of Mar 31, 2016.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision higher for the current quarter compared to three lower. In the past month, the consensus estimate has declined 8.5% due to these changes.
At this time, Imax's stock has a poor Growth Score of 'F'. However, its Momentum is doing a lot better with an 'A'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. It's no surprise that the stock has a Zacks Rank #4 (Sell). We are looking for a below average return from the stock in the next few months.
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Imax Corp (IMAX) Down 15.6% Since Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Imax Corporation (IMAX - Free Report) . Shares have lost about 15.6% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
First Quarter Earnings
IMAX reported break-even earnings per share in the first quarter, which compared favorably with the Zacks Consensus Estimate of a loss of $0.01. IMAX’s earnings per share in the first quarter of 2016 stood at $0.14. Total revenue in the first quarter of 2017 was $68.7 million, down 25.48% year over year. The figure also missed the Zacks Consensus Estimate of $71.1 million. Adjusted EBITDA margin in the reported quarter was 29.5%. Category wise, equipment and product revenues were $11.5 million, down 51.4%. Services revenues totaled $38.8 million, down 12.26%. Rentals revenues totaled $15.8 million, down 27.19%, while Financial income was $2.4 million, up marginally.
Segmental Results
IMAX Theater Business generated revenues of $23.2 million down 33.8% year over year. Within this segment, IMAX system sales and sales-type leases were $6.9 million, down 61.43%. Ongoing fees and finance income was $2.5 million, down 3.4%. Meanwhile, Joint revenue sharing arrangements-fixed fees was $0.5 million, down 77.3%. Theater system maintenance was $11 million, up 12.41%, while Other Theatre revenues fell 13% to $2.2 million. Network Business generated revenues of $39.3 million, down 24.8% year over year. Within this segment, IMAX DMR was $23.4 million, down 21.5%. Joint revenue sharing arrangements-contingent rent was $15.2 million, reflecting a decline of 28.5% and IMAX systems-contingent rent deteriorated 42% to $0.7 million. Other segments generated revenues of $4.8 million, down 1.62% year over year. Within this segment, Film distribution and post-production was $3.6 million, up 29.4%, and Other revenues were down 37% to $1.2 million. IMAX exited the first quarter with cash and cash equivalents of $190.5 million, compared with $204.7 million at the end of 2016.
Network Growth Statistics
The company installed 15 theaters (including 1 upgrade) as against 19 (including 9 upgrades) in the first quarter of 2016. The company signed 39 theatre agreements in the first quarter of 2017 compared with 36 in the year-earlier quarter. As of Mar 31, 2017, total theater count in backlog was 524 compared with 388 as of Mar 31, 2016.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision higher for the current quarter compared to three lower. In the past month, the consensus estimate has declined 8.5% due to these changes.
Imax Corporation Price and Consensus
Imax Corporation Price and Consensus | Imax Corporation Quote
VGM Scores
At this time, Imax's stock has a poor Growth Score of 'F'. However, its Momentum is doing a lot better with an 'A'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The company's stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. It's no surprise that the stock has a Zacks Rank #4 (Sell). We are looking for a below average return from the stock in the next few months.