AMC Entertainment Holdings (NYSE:AMC) could enjoy revenue growth and a second consecutive year of market share gains, despite being overshadowed by the likes of high debt, analysts say.
Despite a lack of recent dividend payments, buybacks and facing billions worth of debt, Wedbush said the movie company would still have positives to look forward to this year.
“AMC expanded its market share in 2023 and can expand further [...] with its vast network of premium large-format screens and concert movie distribution,” the bank said in a note.
“AMC also has an opportunity to drive revenue growth from its European circuit with theater upgrades that would boost per-screen averages.”
According to Wedbush, AMC’s debt and lack of dividends “overshadow these positive factors”.
That said, the firm has worked to alleviate the debt pile, with some US$865 million being raised through equity sales last year and Wedbush expecting more in 2023.
Following a slimmer-than-expected net loss of US$0.54 a share over the fourth quarter, Wedbush said the first quarter would likely bring similar news, given the release of Dune 2 in March.
Positive earnings could then be on the cards over the full year as headwinds from the likes of strikes ease over the latter half.
Wedbush reiterated a ‘neutral’ rating for AMC, alongside a share price target of US$6 - up 20% on Wednesday’s close.