2023 hasn’t been kind to AMC Entertainment (NYSE:AMC), despite the releases of Barbie, Oppenheimer and the Taylor Swift: The Eras Tour movie. Making matters worse, financial firm Macquarie just issued a warning for the box office in 2024. This comes despite the Hollywood actors’ and writers’ strike resolution. In addition, Macquarie cut its AMC stock price target to $8 from $9, reflecting an 11% drop.
AMC wasn’t the only movie theater company to receive a price target reduction. Macquarie also lowered its target for Cinemark Holdings (NYSE:CNK) to $21 and its target for IMAX (NYSE:IMAX) to $25.
AMC Stock: Macquarie Lowers Price Target, Issues 2024 Box Office Warning
For 2024, Macquarie doesn’t expect any film to generate more than $300 million in sales. The firm also provided a list of movies that are expected to sell well next year, such as Deadpool 3, Mufasa: The Lion King and Joker 2.
Meanwhile, Macquarie “remains comfortable” with its fourth quarter box office estimate of $2 billion. For 2024, the firm forecasts $8.9 billion in sales, reflecting a 2% decline from its estimated 2023 numbers and a 22% decline compared with 2019.
B. Riley analyst Eric Wold also recently provided his thoughts on AMC with a much higher price target. Earlier this month, he lowered his fourth-quarter box office estimate to $1.878 billion from $2.167 billion. That would bring his 2023 box office estimate to $8.927 billion from $9.216 billion. For 2024, he expects box office revenue of $8.609 billion, down by a significant 10.5% from his prior estimate of $9.617 billion. He also lowered his 2025 estimate to $9.920 billion from $10.299 billion. His 2025 estimate is about 87% of pre-pandemic levels as some movie-goers shift to streaming and other readily available entertainment channels.
The analyst still remains “positive” about the industry:
“With our view that moviegoing demand remains strong in the post-pandemic era and that a hiccup in 2024 is only a reflection of strike-driven production delays, we remain positive on the outlook for the industry.”
Wold carries a “neutral” rating on AMC with a price target of $15, implying an upside of about 120%.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
