AMC Theatres Gets Stock Upgrade on Outlook of “More Consistent” Blockbuster Releases

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Has the most challenging period passed for AMC Theatres, as suggested by one financial analyst’s perspective?

Following Hollywood’s assurance about providing blockbuster movies for AMC, analyst Alicia Reese has now upgraded the company’s stock rating from ‘neutral’ to ‘outperform’, and increased her price target from $3.00 to $4.00.

Hollywood confirmed it would supply big-budget films to AMC, causing analyst Alicia Reese to upgrade AMC’s stock from ‘neutral’ to ‘buy’ recommendation, and she raised her predicted price for the stock from $3.00 to $4.00.

On July 11, Reese suggested in a note to investors that AMC is well-positioned for a stable lineup of releases in the upcoming quarters, which could help it increase its market share in North America and Europe up until 2026. This positive forecast helped boost AMC Entertainment Holdings’ shares by 30 cents, or 10%, to $3.30 in morning trading on Friday.

According to Wedbush’s analysis, AMC’s debt issues appear less concerning now since the company has either paid off or delayed all debts that were due in 2026. In other words, with box office revenues expected to stabilize in the upcoming quarters, we anticipate that AMC’s earnings before interest, taxes, depreciation, and amortization (EBITDA) will be sufficient to cover its interest expenses. This means they won’t need to issue additional shares as often. This is what Reese wrote.

In the past, AMC has been known for its unpredictable nature as the cinema giant struggled to stay afloat by spending cash rapidly and securing additional funding through new stock issues. However, on July 1, AMC revealed a deal with crucial creditors, debt holders, and other lenders that provided greater financial flexibility, settled significant legal disputes, and allowed the company to concentrate on boosting its box office revenues.

The Wedbush analyst has emphasized that they do not foresee a smooth journey ahead for AMC. In other words, they expect minimal expansion in 2025, 2026, and beyond. They view this industry as one with limited growth potential during the recovery phase. Over the next few years, they predict moderate to high single-digit increases in box office revenue, which will then be followed by low to mid single-digit growth rates.

A financial expert believes that cinema owners may find some relief, as big movie studios decide to return to traditional cinema screenings following the unpredictability caused by cinema shutdowns during the pandemic, along with the move of many Hollywood films onto new streaming services.

In 2023, the series of strikes within the industry caused a halt in the delivery of Hollywood movies to local cinemas. However, following the SAG-AFTRA strike in 2023/2024, studios have collectively produced an engaging and well-balanced selection of films for the years 2025 to 2026. We anticipate that this variety will entice audiences to cinemas, despite any economic instability. This is according to Reese’s recent note.

To ensure continued success in Hollywood, it’s crucial to consistently produce blockbusters, ranging from revamped comic book adaptations to thought-provoking films by directors like Paul Thomas Anderson and Yorgos Lanthimos. This will encourage audiences to frequent cinemas, even amidst economic uncertainties.

Historically, the movie industry has proven to be resilient during economic downturns, as people continue to attend due to the quality of the films and because it’s seen as a relatively affordable escape from everyday life. At this point in time, our main worry is about maintaining high-quality content rather than broader economic pressures affecting ticket sales.

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2025-07-11 17:54