What Hollywood’s Hot Year Means for AMC, Cinemark, and Other Theater Stocks

Tom Rhys Harries in the horror movie “Clayface,” which debuted over the weekend. (Courtesy Warner Bros. Pictures)

Key Points

Domestic ticket sales reached an estimated $8.36 billion through Sunday, about 20.2% higher than at the same point in 2025.
Roth analyst Eric Handler raised his target price for shares of both AMC Entertainment and Cinemark Holdings.
Handler expects three films opening on Dec. 18 to collectively surpass $1 billion in domestic box office.

Hollywood’s relentless race toward a new domestic box office record continued this weekend, with moviegoers shelling out an estimated $94.9 million on a wide array of movie genres and story lines.

Warner Bros.’ Clayface, a psychological horror film about a gruesome monster out for revenge, opened at the top of the North American box office with $24 million in ticket sales across nearly 3,500 screens, according to Rentrak.

Domestic ticket sales through Sunday are at an estimated $8.36 billion, about 20.2% higher, or $1.4 billion more, than at this point in 2025, according to Rentrak. That’s despite the fact that October is typically the slowest month in the fourth quarter because studios are reserving their biggest hits for the Thanksgiving and December holiday weekends.

It’s also welcome news for movie theater operators, which drew audiences for a record summer movie season with four straight months of $1 billion-plus in ticket sales. Theaters have also seen brisk sales of snacks, popcorn, and limited-edition movie merchandise.

Eric Handler, managing director and senior research analyst for Roth, has raised his target price for shares of both AMC Entertainment and Cinemark Holdings, the largest and third-largest movie theater operators in the U.S., as well as for IMAX Corp. (Regal Cinemas, owned by Cineworld World, is the second-largest theater operator in the U.S.)

Citing record third-quarter domestic box office, up 29% from last year, and stronger-than-expected growth in Europe in the mid-30% range, Handler raised his third-quarter estimate and AMC price target to $3.25 from $3. He rates AMC stock as Neutral.

AMC should see “notable market share gains given its sizable IMAX exposure and the stellar performance of The Odyssey,” he wrote. He said break-even free cash flow this year “would not be surprising” and called AMC’s recent $4 billion debt refinancing and extension of maturities to at least 2031 “encouraging.”

He noted that S&P Global Ratings upgraded its credit rating for AMC one notch to B- from CCC+ in late July, and Moody’s Ratings upgraded it by two notches to B3 from Caa2 in September, which helped reduce interest rates for the debt.

He also raised his third-quarter revenue forecast for AMC to $1.698 billion, up 30% from last year, and he expects AMC’s earnings before interest, taxes, depreciation, and amortization, or Ebitda, to rise 158% from a year ago, to $315 million. He projects adjusted Ebitda margin will nearly double to 18.6%, the first time since 2018 that AMC will have two consecutive quarters of Ebitda margins above 15%.

AMC Entertainment stock is up 85.9% this year, and up 7.4% over the past 12 months.

That same third-quarter industry performance, along with double-digit gains in Latin America, prompted Handler to raise his price target for Cinemark to $45 from $44. He sees adjusted Ebitda “exceeding 25% for a second consecutive quarter (and for the first time in the company’s history).” He has a Buy rating on the stock.

Handler raised his revenue forecast for Cinemark to $1.035 billion for the third quarter, up 21% from last year, and he hiked his adjusted Ebitda forecast to $262 million, which would be up 48%. Cinemark was a Barron’s stock pick in June.

He noted Cinemark’s “capital allocation flexibility.” With $504 million in cash on hand and $1.877 billion in total debt, it has “substantial capacity” for mergers and acquisitions or increased capital returns, he said. Although there hasn’t been an abundance of theater assets available for sale since the pandemic, “with the box office headed back above $10 billion, and the industry in a healthier structural environment, we think several regional operators could consider selling.”

He mentioned a number of U.S.-based independent theater operators that have been family owned for more than 40 years and that could become up for grabs, including B&B Theatres, Harkins Theatres, Malco Theatres, Neighborhood Cinema Group, and Premiere Cinemas.

The analyst said he wouldn’t be surprised if the U.S. assets of Mexican-based operators Cinepolis (Cinepolis Luxury Cinemas) and Cinemex (CMX Cinemas) also received offers, but doesn’t see Canada’s dominant cinema operator, Cineplex , as a logical buyout candidate, “as cross border transactions do not offer scale benefits.”

Cinemark stock is up 70.1% this year, and 46.7% over the past 12 months.

Handler also raised his price target for IMAX Corp., saying the large-screen format theater operator “blew away all expectations” in its record third quarter, with a 98% jump in box office. He predicts that the success of Christopher Nolan’s The Odyssey will elevate IMAX’s brand value and “foster greater collaboration with movie studios/directors.” His new price target is $62, from $60, with a Buy rating.

The Odyssey finished the third quarter with a record gross box office of about $537 million, compared with his forecast of $475 million. Sony Pictures’ Spider-Man: Brand New Day added another upside surprise, with $58 million in gross box office revenue for IMAX, including $24 million from China.

The analyst said he wouldn’t be surprised to see IMAX seek to add more screens where possible from its current 421 screens worldwide, especially in high population markets. “An accelerating systems installation schedule in 2027 could help to overcome what will likely prove challenging year-over-year gross box office comparisons,” he added.

IMAX stock is up 44.4% this year and 65.7% over the past 12 months.

Handler said the fourth-quarter domestic box office is at $367 million so far, up 40% from 2025, and faring better than expected. He projects quarterly revenue of $2.525 billion, or 16% higher than last year. Of that total, he expects three films to collectively surpass $1 billion in domestic box office: Avengers: Doomsday, Dune: Part Three, and Jumanji: Open World, all opening on Dec. 18.

This weekend’s offerings sold an estimated $94.9 million of tickets through Sunday, up 21.8% over the same weekend last year, according to Rentrak. Clayface sold another $19 million internationally, for a $43 million global opening.

In second place, A24’s You Can See Everything, the nearly three-hour documentary about Theranos founder Elizabeth Holmes, expanded to 2,655 theaters and sold another $19.5 million in its second weekend. bringing its domestic total to $45.1 million.

Fathom Entertainment and Laika’s Wildwood, the stop-motion fantasy adventure about a young girl searching for her kidnapped baby brother in a forbidden forest, opened in third place with $11.8 million.

“Clayface adds another win to the horror column in what has already been an extraordinary year for the genre,” Rentrak’s head of marketplace trends Paul Dergarabedian told Barron’s. “With an estimated $1.352 billion in domestic horror box office through Sunday, we’re now just $74.2 million away from matching the all-time annual record of $1.426 billion set in 2025,” with more than two months to go.

“Horror has been delivering consistently throughout the year, with films representing a wide range of budgets, styles, and audiences,” Dergarabedian said.

Upcoming horror flicks include Breeder, opening Wednesday; Christmas at the Kringles, opening Friday; and Robert Eggers’ Werwulf, opening Dec. 25, along with specialty releases and anniversary engagements that will add to the genre’s annual total, he said.

Write to Janet H. Cho at janet.cho@dowjones.com

参与讨论