Tuesday, December 22, 2015 9:46:26 AM
4:09 PM ET 12/21/15 | MarketWatch
By Tomi Kilgore, MarketWatch
IMAX's stock may be following the Wall Street adage 'buy the rumor, sell the news'
Shares of IMAX Corp. stock dropped Monday, as did other "Star Wars" theater stocks, as the movie's record box-office take plus upbeat analyst comments failed to generate new interest among investors.
IMAX's stock (IMAX) slid 4.2% trade on volume that FactSet data show was more than double the full-day average, to close at the lowest level since Oct. 14.
The stock suffered although "Star Wars: The Force Awakens" produced a record global weekend for the movie-theater company, including opening-weekend records for both domestic-and international openings.
J.P. Morgan analyst Alexia Quadrani said IMAX's domestic market share for the weekend was an "impressive" 12.6%, and that the movie's opening in China early next month would be a significant contributor to results given IMAX's large presence in the world's second-largest box-office market.
Analyst Eric Handler at MKM Partners said per-screen average for "Star Wars" showings at IMAX theaters was nearly $77,000, the highest total ever for the company. "The bar was set high for "Star Wars: The Force Awakens" and the film delivered in setting a new opening weekend record...and beating forecasts," Handler wrote in a research note.
There are a few reasons why the stock may be suffering in the fact of a strong "Star Wars" performance:
1) This old Wall Street adage: "Buy the rumor, sell the news." That describes the tendency of many investors to buy a stock if they believe good news is coming, then to cash in their bets when the good news arrives. The bigger the hype, the harder the stocks fall.
IMAX's stock soared 17% from the end of September through Dec. 16, the day before the movie opened, while the S&P 500 index gained 8% over the same time.
2) Although the "Star Wars" blowout opening weekend pushed quarter-to-date box-office revenue growth into positive territory compared with a year earlier, the company's overall fourth-quarter box office continues to track below consensus expectations of 10% to 12% growth, MKM's Handler said.
"In our view, the box office is more likely to finish up (DIS) in the 4%-6% range," Handler wrote in a note to clients.
3) Walt Disney Co., which owns the "Star Wars" franchise, may be charging theaters ("exhibitors" in Wall Street lingo) more than usual to be able to show the movie.
Recent IMAX News
- IMAX Corporation Reports First Quarter 2024 Earnings Results • PR Newswire (US) • 04/25/2024 11:30:00 AM
- IMAX® and CineNOVA Launch Partnership With Four New IMAX Locations Across Turkey • PR Newswire (US) • 04/24/2024 04:00:00 PM
- Gabelli Funds to Host 16th Annual Media & Entertainment Symposium Thursday, June 6, 2024 • GlobeNewswire Inc. • 04/22/2024 12:00:00 PM
- IMAX Corporation to Announce First-Quarter 2024 Financial Results and Host Conference Call • PR Newswire (US) • 04/11/2024 08:05:00 PM
- IMAX® And Miraj Cinemas Enter Partnership With Three New IMAX With Laser Locations Across India • PR Newswire (US) • 04/10/2024 05:30:00 PM
- IMAX® And Major Cineplex Expand Longstanding Partnership with Three New IMAX With Laser Locations Across Thailand • PR Newswire (US) • 04/09/2024 12:30:00 PM
- IMAX and Bona Film Group Expand Partnership with Three New IMAX Locations in China • PR Newswire (US) • 04/09/2024 12:30:00 PM
- NBC Television Network's Live Coverage Of 2024 Paris Olympics Opening Ceremony To Make IMAX Debut • PR Newswire (US) • 03/22/2024 01:00:00 PM
- IMAX® Original Documentary "Deep Sky" To Open Across North America For A Special 1-Week Limited Run Beginning April 19 • PR Newswire (US) • 03/19/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:55:20 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:50:10 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:45:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:40:19 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:35:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:30:35 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:20:14 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:15:36 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/11/2024 08:14:57 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:10:15 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:05:10 PM
- IMAX Sets New Record for Global Market Share with "Dune: Part Two" • PR Newswire (US) • 03/11/2024 12:30:00 PM
- IMAX To Present At The 36th Annual ROTH Conference • PR Newswire (US) • 03/05/2024 01:30:00 PM
- Form 144/A - Report of proposed sale of securities: [Amend] • Edgar (US Regulatory) • 03/01/2024 09:35:41 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 02/29/2024 09:32:51 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 02/27/2024 09:24:14 PM
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