Wells Fargo double upgrades Cinemark, says ‘movies are back’

Wells Fargo double upgraded Cinemark to Overweight from Underweight with a price target of $23, up from $13. The firm says “movies are back!” The analyst cites better tentpole performance, the de-risking of 2024 estimates and growing conviction on the company’s 2025 for the upgrade. Several films outperformed in Q1, a sign that consumer demand is robust with “legs to next year,” the analyst tells investors in a research note. The firm believes Cinemark has lots of operating leverage, and says the stock is still inexpensive despite the rally year-to-date. It sees 50% upside potential on the company’s earnings power.