Cinemark (NYSE: CNK) stock price has continued to trounce AMC this year. It has jumped by a whopping 42%, beating the S&P 500 and Nasdaq 100 indices, which are up by about 10%. Notably, Cinemark has completely diverged from AMC, which has bottomed to a record low amid a series of equity raises.
Analysts are optimistic about AMCCinemark share price has been in a strong bullish trend since December. It has jumped by 139%, making it one of the best-performing companies in Wall Street.
The stock continued rising on Friday after an analyst at Wells Fargo boosted his rating. He raised his rating from underweight to overweight, citing the many planned movies of the year. He believes that the Cinemark stock price could surge to $23 in the coming weeks.
Wells Fargo believes that there are 76 movies set to be released in 2024 and 2025. Some of the most notable ones are Inside Out, Despicable Me, and Deadpool. As such, these titles could lead to higher revenues and profits for the company.
Cinemark’s business has been in a slow recovery. Its revenue plunged to $587 million in 2020 as the government shut down its stores during the pandemic. It then jumped to $1.3 billion in 2021 and $2.7 billion in 2023 because of Barbie, Oppenheimer, and Eras Tour.
The company has also become profitable as the management made more cost-cut measures. It moved from a net loss of $268 million in 2022 to over $191.5 million last year. The management believes that this growth will continue in the coming years.
Like AMC, Cinemark boosted its debt during the Covid-19 pandemic and has been reducing it in the past few years. Its total debt jumped from $3.4 billion in December 2020 to a peak of $3.9 billion in 2021. It has now slashed the total debt to $3.55 billion.
Like Cinemark, AMC has also been a dilutive company. It has increased the number of outstanding shares from 117 million to $121 million.
Cinemark has no major maturities scheduled this year. In 2025, it has maturities worth $1.3 billion followed by an unsecured note of $405 million in 2026. Cinemark ended the last quarter with about $850 million in cash and equivalents.
I expect that Cinemark will raise some equity this year, which could hit its stock. In a recent statement, the CFO said:
“Our capital allocation priorities remained balanced and disciplined, as we prioritize addressing our 2025 maturities and investing in the long term while managing through content volume headwinds this year.”
AMC, on the other hand, AMC Entertainment has substantial maturities worth almost $3 billion in 2026.
Cinemark stock price forecast
The weekly chart shows that the CNK share price has made a strong comeback in the past few weeks. It has now jumped to the key resistance level at $19.75, where it failed to move above in October 2023 and July 2022.
The stock has rallied above the 50-week and 200-week Exponential Moving Averages (EMA), which is a positive thing. It has also risen above the 38.2% Fibonacci Retracement level. Therefore, a break above the resistance at $19.75 will point to more upside to $23.50, the 50% retracement point.
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