AMC Entertainment Holdings (NYSE:AMC)
When investors responded to what turned out to be a mixed bag of fourth-quarter earnings for the movie theater chain operator AMC Entertainment Holdings (NYSE:AMC), AMC stock plummeted more than 5% in pre-market trade on Wednesday.
AMC published its quarterly earnings late on Tuesday night. They were better than what Wall Street analysts had projected for the company. Upon completing the assessment, Chief Executive Officer Adam Aron said that AMC was proceeding down “a multi-year glide path to recovery.”
Yet by the morning of Wednesday, AMC stock had dropped significantly because the company’s data revealed it was still having trouble getting growth back on track.
The overall revenue of AMC, which came in at $990.9 million, was down by 15% compared to the previous year. At the same time, the company’s loss, excluding one-time factors, increased to 14 cents a share from the previous year’s loss of 6 cents a share.
The total number of individuals who went to the movies at an AMC theater last year was 49.6M, 17% less than the previous year. The release of the critically acclaimed film Avatar: The Way of Water during the busy Christmas season likely contributed to the significant drop in attendance.
The firm also said that revenue from admissions, which totaled $561.3 million, decreased by 16% when compared to the same period in the prior year, while sales of food and drinks, which totaled $331.2 million, down by 13% when compared to the previous year.
The analysts working for Wall Street firms and writers contributing to Seeking Alpha recommend selling AMC stock. Nevertheless, Seeking Alpha’s Quant System, which has historically outperformed the stock market, is even more pessimistic about AMC and assigns a strong sell recommendation to the company’s shares. The Quant System believes that AMC will continue to underperform the market.