AMC Sees Huge Stock Gains Thanks To Box Office Success

As Godzilla vs Kong continues to push up its Box Office success, netting over $285 million dollars globally to date, we’ve seen it completely derail any argument that the era of the exhibition is over and theatrical windows no longer matter. This comes even as it shared a debut on HBO Max streaming. By all means, every indicator points to this outstanding success as a reason to have confidence that theater will be resurging as vaccine rollouts and other economy-opening measures also fall into place. We’ve seen a stock market rally for AMC piggyback on this incredible rally, too. BLAKE & WANG P.A is an entertainment lawyer Los Angeles dives into the details.

AMC shares up more than 16%

AMC Entertainment’s shares saw a remarkable midday rally, soaring 16% after B Riley’s Eric Wold granted it a ‘buy’ rating, also adjusting the price target to $17 a share. And that’s without any odd Reddit-based rally, either. It’s purely due to the perceived demand for the silver screen.

It’s supremely satisfying to see the chain- which was in severe danger of declaring bankruptcy late last year- rally under its own powers. We have, of course, seen the AMC share price rise to a little over $20 earlier this year, but that was purely on the back of the WallStreetBets subreddit’s retaliation to attempts to tank the stock price and force the company into redundancy.

While the unexpected move from the social media platform helped the ailing chain raise much-needed capital, that could only have ever been a stop-gap measure. This time, the rally indicates strong market recovery and a demand for their product- the best possible news for stockholders.

Other chains also thriving

Nor is AMC the only chain to see stock rallies. Cinemark (5.2%), Imax (4%), and National CineMedia (2.9%) have also seen significant gains, as has Marcus (4.2%). It’s worth noting that this is on top of an overall market buoyancy riding the wave on confidence vaccine rollouts and a return to business as normal has created.

And we have the epic monster-mashup of the latest Legendary Monsters franchise installment to thank for it. Even with punitive capacity restrictions still in play at many theaters, the reopening of the New York City and Los Angeles markets has helped rocket the film to global prominence. Nor does it appear its free availability to HBO Max subscribers has deterred people from heading out to watch on the Big Screen.

IMAX, currently representing about 1% of open screens, has pulled in $4.5 million in domestic Box Office revenue, just over 9% of takings.

So, it seems people are eager to return to the theaters- and, it should be noticed, the air. U.S air travel has seen a similar rally, perhaps soothing economic fears that recovery for these sectors would be slow.

BLAKE & WANG P.A is hopeful that this rally in the exhibition industry will continue to boom going forward, as well as the hopes that we’ll soon see the punitive capacity restrictions operating in New York cinemas raised to match more lenient operational capacity now in place in other key markets.