December 28, 2020
With the relative release success of Wonder Woman 1984 suggesting consumers are willing to return to movie theaters during the pandemic, stocks of the publicly traded exhibitors inched higher in Dec. 28 pre-market trading.
Shares of AMC Entertainment and Cinemark Holdings, representing the No. 1 and No. 3 theatrical chains in the U.S., climbed 5.6% and 1.8%, respectively. No. 2 exhibitor Regal Cinemas remains temporarily shuttered. Separately, EPR Properties, landlord to many movie complexes, saw shares inch up 0.7%.
In addition, Cinedigm, which has been looking to offload its digital projection business, saw shares increase 2.2% following the WW84 weekend.
The uptick comes as the exhibition business reels from the ongoing pandemic that has seen theatrical revenue plummet 80% heading into the Wonder Woman 1984 holiday weekend. AMC Theatres, the world’s largest exhibitor has been operating on the edge of bankruptcy, with cash reserves expected to run out in January without an uptick to business or outside funding.
Eric Wold, analyst with B. Riley Securities, said the relative early box office success of WW84, driven by more than 10,000 private watch parties, underscores the appeal of large screen exhibitions for the right movie.
“When consumers are allowed back to theaters with attractive content, they will once again become moviegoers,” Wold wrote.
Shawn Robbins, analyst at Boxoffice Pro, said that with WarnerMedia’s decision to release WW84 on HBO Max simultaneously with its theatrical debut, the jury remains out on the strategy’s impact on Hollywood and exhibitors.
“We’ll have to continue waiting until next year to truly gauge how studios feel about this strategy and for how much longer they’ll deem it necessary,” Robbins told Bloomberg. “This film alone may not be a great barometer to go by.”