Taylor Swift's Concert Film & Beyoncé's Documentary: How They're Setting Cinemark Up for A Breakout Q4, Says Analyst

Benchmark analyst Mike Hickey reiterated a Buy rating on the shares of Cinemark Holdings Inc CNK and raised the price target from $21 to $22.

The analyst has revised the Q3 sales estimate upwards to $833 million as box office results have surpassed initial forecasts.

In 3Q 2023, the domestic box office grossed $2.65 billion, a 37.6% increase from 2022, with Barbie leading the charge.

The analyst sees an AEBITDA of $180 million, a 21.6% margin, surpassing the consensus of $153 million at 19.6%, backed by more attendees and cost efficiency. Q4 2023 has a promising lineup for the box office.

Taylor Swift's upcoming concert film is breaking presale records at Cinemark, with demand 10x higher than any past event film, and is expected to earn $100 million - $125 million on its opening weekend, noted the analyst.

Beyoncé's documentary on her "Renaissance" album will premiere in theaters from December 1, running Thursdays to Sundays for four weeks, with a projected $20 million opening.

In comparison to Q3 2019's $2.81 billion gross, 2023 achieved 94.1% of those figures.

The analyst has confidence in CNK's complete recovery from the pandemic and is optimistic about sustained growth.

The analyst anticipates a swift resolution to the Hollywood actor strike, followed by a renewed emphasis on outstanding growth driven by captivating film offerings and diverse content like concerts and sports. 

Price Action: CNK shares are trading higher by 4.93% at $19.60 on the last check Friday.