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AMC Networks (NASDAQ:AMCX) Inc. shares have tumbled to a 52-week low, with the stock price touching $5.7, reflecting a period of significant pressure for the company. According to InvestingPro analysis, the stock appears undervalued at current levels, with technical indicators suggesting oversold conditions. This latest price level underscores a challenging year for the cable network, which has seen its stock value decline by 46.18% over the past year. Despite the challenges, the company maintains a healthy balance sheet with a current ratio of 2.38, indicating strong short-term liquidity. The entertainment company, known for producing popular series such as "The Walking Dead," has been grappling with industry-wide headwinds, including cord-cutting and shifts in viewer preferences. The 52-week low serves as a stark indicator of the hurdles AMC Networks faces as it strives to adapt to the rapidly evolving media landscape. InvestingPro subscribers can access 8 additional key insights about AMCX's financial health and market position through the comprehensive Pro Research Report.
In other recent news, AMC Networks reported its fourth-quarter 2024 earnings, revealing that both earnings per share (EPS) and revenue fell short of analysts' expectations. The company posted an EPS of $0.64, significantly below the anticipated $1.03, and revenue came in at $599 million, missing the forecast of $609.37 million. This performance has led to analysts revising their outlooks. UBS analyst John Hodulik has cut the price target for AMC Networks stock to $8 from $9, maintaining a Sell rating, citing the company's mixed performance and guidance for 2025 that fell short of market expectations. Similarly, TD Cowen analyst Doug Creutz reduced the price target to $6 from $11, while maintaining a Hold rating, following the company's fourth-quarter earnings report.
AMC Networks' guidance for 2025 projects a 5% revenue decline to approximately $2.3 billion, attributing this to challenges in the linear television sector and decreased licensing revenue. Despite these challenges, the company reported an 8% increase in streaming subscribers, reaching 12.4 million, highlighting growth in its digital platforms. The company also reported better-than-expected free cash flow for the fourth quarter at $38 million, ending the year with $330 million. Management has raised its combined free cash flow outlook for 2024-2025 by about 10% to $550 million. AMC Networks plans to focus on reducing its gross debt, with UBS estimating a net leverage of 3.4 times by the end of 2025.
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