Benchmark reiterates buy on Marcus Corp stock with $25 target

Published 07/05/2025, 16:42
Benchmark reiterates buy on Marcus Corp stock with $25 target

On Wednesday, Benchmark analysts maintained a Buy rating and a $25.00 price target for Marcus Corp (NYSE:MCS), following the company’s first-quarter performance, which surpassed expectations. According to InvestingPro data, the stock currently trades at $16.58, suggesting significant upside potential to the analyst target. With a market capitalization of $525 million, Marcus Corp is currently trading near its Fair Value based on comprehensive analysis. The company’s theatrical segment saw increased attendance, although margins were squeezed due to higher film rental costs and normalized labor expenses. These results were in line with prior projections that took into account the ongoing effects of holiday movie releases and specific inefficiencies related to the release of "Snow White." The company’s gross profit margin stands at 41%, while revenue grew by 3.8% in the last twelve months.

The hotel operations of Marcus Corp also reported positive Adjusted EBITDA, buoyed by a robust ski season at the Grand Geneva Resort & Spa and consistent group demand. The company’s early second-quarter results are promising, with films such as "A Minecraft Movie," "Sinners," and "Thunderbolts" performing better than anticipated. This performance supports Benchmark’s expectation that a strong second-quarter film lineup could lead to further positive results.

During the first quarter, Marcus Corp invested in its future growth by repurchasing $7.1 million in shares and continuing to reinvest in high-return on investment (ROI) assets, such as the Hilton Milwaukee. These actions demonstrate the company’s strategy of balancing capital returns with the creation of asset value. The company maintains a modest dividend yield of 1.73% and has raised its dividend for three consecutive years, as noted in InvestingPro’s analysis, which offers 6 additional key insights about the company’s financial health and prospects.

Benchmark’s analysis suggests that Marcus Corp is well-positioned for recovery and is a defensively oriented investment opportunity. The company’s actions to manage costs and invest in assets with high ROI are viewed as steps toward strengthening its market position. While currently not profitable over the last twelve months, InvestingPro analysts expect the company to return to profitability this year, with projected earnings per share of $0.66 for fiscal year 2025. For deeper insights into Marcus Corp’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Marcus Corporation reported its first-quarter 2025 earnings, revealing a greater-than-expected loss in earnings per share (EPS). The company posted an EPS of -$0.54, missing analysts’ forecasts of -$0.43. Despite this, revenue exceeded expectations, reaching $148.8 million compared to the projected $145.56 million. The theater division saw a 6.9% increase in comparable theater attendance, while the hotel division experienced a 10% rise in banquet and catering revenues. However, Marcus Corporation also reported an operating loss of $20.4 million, a decline from the previous period. The company has a positive outlook for the upcoming summer movie season and plans capital expenditures between $70 and $85 million for fiscal 2025. CEO Greg Marcus expressed optimism about the company’s future, emphasizing the importance of their workforce.

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