Shares of AMC Entertainment Holdings (NYSE:AMC) rose more than 10% on Friday after Wedbush upgraded the movie theater chain to “Outperform” from “Neutral,” citing improving industry fundamentals, strengthened financials, and potential market share gains over the next two years.
The brokerage raised its 12-month price target on AMC to $4 from $3, implying a 33% upside from current levels.
Wedbush analysts pointed to a more consistent film release slate, AMC’s premium screen footprint, and recent debt management efforts as key drivers for the improved outlook.
“AMC has repaid or postponed all debt due in 2026 and is completing what we expect to be its last major share issuance for the foreseeable future,” Wedbush wrote. “With a stabilized box office and improving free cash flow, the company should no longer need to issue equity to cover interest expense.”
AMC, which operates the most premium screens in North America and is expanding in the UK and EU, is also benefiting from increased per-attendee revenue. Domestic revenue per attendee now sits at $22 to $23, about 30% higher than pre-pandemic levels, while international revenue is around $16.
Wedbush raised its second-quarter revenue estimate to $1.35 billion from $1.25 billion and now expects adjusted EBITDA of $160 million, well above its prior estimate of $85 million. The firm also lifted its EBITDA forecasts for 2025 through 2027, citing higher expected box office volumes and AMC’s leverage on fixed costs.
Still, analysts cautioned that the industry remains in a recovery phase, with modest long-term growth prospects. “To be clear, we do not see substantial growth in 2025, 2026, or beyond. This is a low-growth industry,” Wedbush noted.
AMC shares were last up 10.6% at $3.32 in afternoon trading.