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AMC Entertainment to Reopen The Grove Theatre and The Americana in LA
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AMC Entertainment to Reopen The Grove Theatre and The Americana in LA

AMC Entertainment Holdings, Inc. (AMC) has inked a deal with Caruso, one of the largest and most admired privately-owned real estate companies in the U.S., to acquire and reopen The Grove Theatre and The Americana at Brand Theatre under a long term lease agreement.

The financial terms of the deal have been kept under wraps. Both theatres, formerly Pacific Theatres locations, are situated in world-class lifestyle centers with a wide array of retail, dining, and entertainment services.

The 14-screen Grove Theatre, located in Los Angeles, and an 18-screen The Americana at Brand Theatre located in Glendale remained shut for over a year due to the COVID-19 pandemic.

Slated to open in August, AMC will offer its premium services at the theatres like its popular food and beverage offerings and its loyalty and subscription services AMC Stubs and AMC Stubs A-List.

Furthermore, AMC plans to renovate three auditoriums and launch three premium large format screens at both theatres, which will include AMC’s IMAX, Dolby Cinema, and PRIME. (See AMC stock charts on TipRanks)

AMC continues to be on the lookout to add more locations and is pursuing similar property owners with currently closed locations.

AMC CEO Adam Aron commented, “The Grove and The Americana at Brand theatres are among the most successful theatres in the greater Los Angeles area, and we look forward to delivering the high-quality experience for guests visiting these theatres that AMC is known for in the Los Angeles area and nationally.”

He further added, “AMC is proud to be expanding in the movie-making capital of the world. And we are eager to get started as soon as possible, showcasing for our guests at these two theatres the exciting lineup of movies scheduled throughout the rest of 2021.”

B.Riley Financial analyst Eric Wold recently reiterated a Hold rating on the stock with a price target of $16 (53.8% downside potential).

Wold believes that theatrical windows are being optimized and not shrinking and projects a 35% decline in Q3 followed by another 20% decline in Q4 based on the backlog of delayed films during the second half of the year.

Overall, the stock has a Hold consensus rating based on 1 Buy, 4 Holds, and 3 Sells. The average AMC Entertainment price target of $5.84 implies 83.1% downside potential from current levels.

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