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IMAX to Open VR Stations Nation Wide This Year; Stock Up

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IMAX Corporation IMAX recently provided details regarding its plans to launch Virtual Reality (VR)-stations. The announcement was made at the Bank of America Merrill Lynch Media, Communications & Entertainment Conference. Reportedly, IMAX Entertainment CEO, Greg Foster, mentioned that the company aims to make its virtual reality stations operational in pilot locations by Dec 31, 2016. The announcement found favor with investors with shares of the company gaining 3.17% on Sep 15.

Foster further said that the success of the project is among the top priorities of the company at the moment. In fact, it is devoting around 50% of its time for the purpose. In a bid to popularize the concept among audience, the company aims to introduce bundled tickets so that spectators can enjoy the movie as well as the VR experience. Foster expects that “VR will play at multiplexes and storefronts in an arcade kind of way.”

According to the Hollywood Reporter, Los Angeles is likely to be the first Imax VR location. Subsequently, more such offerings would be made available at IMAX locations in China. We note that the company is focusing a great deal on expanding its Chinese presence as the movie market is highly lucrative in the region. Hence, it is no surprise that IMAX intends to roll out the VR experience in China as soon as possible.

The VR technology, though currently in nascent stage, has been drawing a lot of attention in recent times. However, a VR-based movie will be the first-of-its-kind offering from IMAX. This is expected to draw more people to the theaters going forward, thereby boosting the company’s top line.

Though the company has had a disappointing run at the box office over the past few months, Foster has high expectations from upcoming movies like Doctor Strange. Moreover, he is bullish on the box office prospects for next year.

IMAX Corporation Price

Zacks Rank & Key Picks

IMAX currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Consumer Discretionary sector include Cooper-Standard Holdings Inc. (CENT - Free Report) , Lincoln Educational Services Corp. LINC and Smith & Wesson Holding Corporation SWHC. All three stocks sport a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

Interested in IPOs? Check out the special edition of Zacks Friday Finish Line below, where Editor Maddy Johnson and Content Writer Ryan McQueeney interview Kathleen Smith of Renaissance Capital about the IPO market in 2016 (see part two here).

 

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