Texas Capital maintains IMAX buy rating, $36 price target

Thursday saw Texas Capital Securities reaffirm its Buy rating and $36.00 price target on IMAX Corporation (NYSE:IMAX), following the company’s first-quarter results which surpassed both Texas Capital’s and consensus estimates. Currently trading at $24.10, IMAX maintains a market capitalization of $1.3 billion, with analyst targets ranging from $16 to $35. According to InvestingPro data, the company’s overall financial health score is rated as GOOD, suggesting solid operational fundamentals. The results, announced after the market closed on Wednesday, prompted the firm to maintain a positive outlook on the company’s future growth and profitability.

IMAX reported its first-quarter earnings for 2025, delivering numbers that exceeded expectations. The company’s robust financial position is evidenced by its healthy current ratio of 3.92, indicating strong liquidity, while operating with a moderate debt-to-equity ratio of 0.93. The strong performance came despite a previously anticipated impact from a shift in the box office mix with China. Analysts at Texas Capital Securities had adjusted their estimates before the earnings release in anticipation of this factor.

The company’s earnings report and subsequent management call have strengthened Texas Capital Securities’ confidence in IMAX’s growth trajectory. The firm emphasized robust demand for new IMAX screen installations from exhibitor partners and a sustained consumer interest in the premium moviegoing experience offered by IMAX.

Texas Capital Securities expressed their continued belief in IMAX’s growth prospects for the year. They anticipate a significant expansion in the company’s Adjusted EBITDA (AEBITDA) margins. The firm noted that aside from minor adjustments for quarterly timing, no substantial changes to their estimates for 2025 and 2026 were necessary.

In summary, Texas Capital Securities has reiterated its Buy rating and a price target of $36.00 for IMAX Corporation, signaling confidence in the company’s performance and market position. The analyst’s commentary underscores a positive outlook for IMAX’s operational and financial developments in the upcoming periods.

In other recent news, IMAX Corporation is expected to generate over $1.2 billion in Global Box Office revenues this year, reflecting an increase of more than 30% from 2024. This growth is driven by a robust lineup of films shot specifically for the IMAX format and a resurgence in the Chinese market. In addition to its financial performance, IMAX has expanded its partnership with TOHO Cinemas in Japan, planning to open six new IMAX with Laser systems, enhancing its presence in the region. This expansion includes an upgrade to the TOHO Cinemas Hibiya, marking the first site outside North America to feature two IMAX systems within the same complex.

Furthermore, IMAX has partnered with Kinepolis Group to add nine new IMAX locations across Europe, the United States, and Canada, nearly doubling Kinepolis’ IMAX presence in Europe. Benchmark analysts have reiterated their Buy rating for IMAX with a $30 price target, expressing confidence in the company’s growth prospects. Texas Capital Securities also maintained a Buy rating with a $36 price target, suggesting that IMAX is well-positioned to navigate potential challenges in the Chinese market due to its capability to showcase local language content. Despite rumors of a possible Hollywood film import ban in China, no official statements have been made, and IMAX continues to operate as planned. These developments highlight IMAX’s strategic growth initiatives and its ongoing commitment to enhancing the cinematic experience globally.

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