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On Monday, Goldman Sachs reiterated a Sell rating on Cinemark Holdings (NYSE:CNK) with a steady price target of $22.00. Trading at $30.30, InvestingPro analysis suggests the stock is fairly valued at current levels. In their analysis of the company’s first-quarter results for 2025, Goldman Sachs highlighted that the revenue exceeded expectations at $541 million compared to the $531 million consensus. However, Cinemark’s Adjusted EBITDA fell short at $36 million, below the $39 million that was anticipated, though the company maintains a healthy trailing twelve-month EBITDA of $518.7 million.
Cinemark’s performance in the first quarter was marked by a continued market share of 14.7%, aligning with consensus expectations. Despite this, the company is expected to face challenges in market share during the second quarter due to tough comparisons from the previous year and capacity constraints. Goldman Sachs also noted that film supply is predicted to normalize in 2025 and 2026, bolstered by additional content from technology streamers. With a market capitalization of $3.44 billion and an impressive 71.56% return over the past year, InvestingPro data reveals 12 additional key insights about Cinemark’s market position and growth potential.
The company has reaffirmed its forecast for modest growth in average ticket price (ATP) and moderate growth in per capita spending in the US for 2025. However, Cinemark anticipates facing margin pressures due to rising costs in concessions, wages, and utilities. Furthermore, the firm mentioned Cinemark’s plans to implement a $200 million stock buyback program to counter potential dilution from an upcoming convertible security.
Goldman Sachs has slightly increased its revenue projections for Cinemark in the coming years to reflect the positive momentum in the film slate as of April. Nevertheless, the firm has decided to maintain its expectations for EBITDA, considering management’s forward-looking statements regarding an anticipated higher expense structure. The $22 price target reflects Goldman Sachs’ assessment over a 12-month period, alongside their ongoing Sell recommendation for Cinemark shares.
In other recent news, Cinemark Holdings Inc. reported its first-quarter 2025 earnings, revealing a revenue of $540.7 million, surpassing the forecasted $524.2 million. Despite this revenue beat, the company reported an earnings per share (EPS) loss of $0.32, which was below the anticipated loss of $0.27. The strong performance of the Minecraft movie significantly contributed to the revenue results. Cinemark’s focus on premium movie-going experiences, including recliner seats, also played a role in their financial outcomes. The company continues to maintain a solid cash balance of $699 million, indicating stable liquidity. Analysts from firms like ROTH Capital and Morgan Stanley (NYSE:MS) engaged with Cinemark’s executives during their earnings call, discussing topics such as market share and industry trends. Cinemark remains optimistic about future growth and plans to invest $225 million in capital expenditures for 2025.
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