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Analysts Are Divided about AMC Entertainment ahead of Q3 Results

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Rating synopsis

Ahead of the upcoming third-quarter results, analysts have given AMC Entertainment (AMC) stock an equal number of “buy” and “hold” ratings. On October 29, of the 14 analysts covering AMC, 50.0% recommended a “hold,” and another 50.0% recommended a “buy.”

In the last 15 days, there haven’t been any target price changes for AMC Entertainment. Currently, the analysts’ 12-month average target price for AMC stock is $21.29, which reflects a 13.7% upside to its stock price on October 29.

AMC Entertainment is scheduled to report earnings on November 8. Analysts project the company to report revenue growth of 3.7% to $1.22 billion. Its adjusted EPS is expected to be -$0.47. In the third quarter of 2017, AMC reported adjusted EPS of -$0.33.

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AMC Entertainment’s expenses are on the rise due to its ongoing investments such as the addition of recliners and large-format screens. These expenses are likely to keep the bottom line under pressure. Also, the third quarter tends to be a relatively weak quarter, as most big movie releases are scheduled during the holiday season. AMC has already cautioned that the third quarter could be challenging.

Ratings for Cinemark

In comparison, of the 13 analysts covering Cinemark Holdings (CNK), 69.0% have given its stock a “buy” rating, and the remaining 31.0% have given it a “hold” rating. There have been quite a few price revisions for Cinemark.

On October 24, Wedbush raised its price target for Cinemark stock to $46.00 from $43.00. MKM Partners also revised the target price to $47.00 from $42.00. On October 18, Morgan Stanley upped the price target to $41.00 from $39.00. Analysts’ 12-month average target price for CNK stock is $43.58, which reflects a 7.5% upside to its stock price on October 29. Cinemark is slated to report third-quarter results on November 2.

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