IMAX Hits 52-Week High on Theater Expansion Deal in Dubai - Analyst Blog
Shares of leading global entertainment technology provider, IMAX Corporation IMAX jumped 2.2% on Jun 12, 2015, touching a new 52-week high of $42.60. However, the company’s shares ended Friday’s trading session a little lower at $42.47.
The company’s 2.2% gain came on the back of its extended revenue-sharing contract with Novo Cinemas – the largest cinema chain in the Middle East – to set up 2 new IMAX theaters in Dubai.
The first of the two new screens will be installed at IMG Worlds of Adventure – the world's largest indoor theme park spanning over 1.5 million square feet. Meanwhile, the Wafi Mall will be home to the second one. Notably, with this recent agreement, IMAX’s partnership with Novo Cinemas will now cover 6 theaters.
We note that during the first quarter of 2015, IMAX installed 13 new theaters. As of Mar 31, 2015, the company’s theater count totaled 943 compared with 840 a year ago. Significant overseas expansion, a strong movie line-up, increasing number of theater installations and higher theater backlog should help IMAX maintain such strong numbers in the forthcoming quarters as well.
Meanwhile, IMAX has set its goals in China. Recently, the company’s Chinese unit (IMAX China Holding) filed an application with the Hong Kong stock exchange to get the shares of the division listed on the unit. Also, we are positive on the company's IPO plans for its Chinese unit, as the movie market in China promises significant commercial potential.
The company’s has witnessed upward estimate revisions over the last 30 days for the current year with the Zacks Consensus Estimate moving up 1.1% to $0.92.
IMAX currently has a Zacks Rank #3 (Hold).
Stocks to Consider
Better-ranked stocks in this sector include AMC Networks Inc. AMCX, Grupo Televisa, S.A.B. TV and Gray Television, Inc. GTN. AMC Networks sports a Zacks Rank #1 (Strong Buy) whereas Grupo Televisa and Gray Television hold a Zacks Rank #2 (Buy).
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