"Top Gun: Maverick" soared to the top of the box office this past weekend, smashing a 15-year record for Memorial Day weekend — but one AMC (AMC) bear is still not changing his outlook quite yet.
"At this point, it doesn't really change our view," Macquarie analyst Chad Beynon, who maintains an underperform rating on the stock with a 12-month price target of $6 a share, told Yahoo Finance in a new interview (video above).
"We're sticking with our forecast for 2022 and 2023," the analyst added, noting how May's total box office figures lagged pre-pandemic levels by 30% with the theater chain's Q1 revenue dropping 35% compared to 2019.
In a new note, Beynon referenced AMC's elevated cash burn, along with a confluence of other headwinds such as labor shortages, supply chain issues, record-high inflation, unresolved questions surrounding streaming, and the performance of mid-market movies.
"Bottom line, we believe signs are pointing to a multi-year recovery from a balance-sheet and fundamentals perspective," the note stated.
'If we start to see the blockbusters deliver...'
Paramount (PARA) released "Maverick" as the widest theatrical launch in history at 4,732 locations. That's higher than the prior opening weekend record of 4,725 locations by 2019’s "The Lion King" remake, Box Office Pro data revealed.
The sequel to the 1986 classic brought in an estimated $160.5 million over the long holiday weekend, giving Tom Cruise his first $100 million opener and marking the best Memorial Day opening on record. (Disney's "Pirates of the Caribbean: At World’s End," released in 2007, held the previous record at $153 million, according to official numbers.)
AMC said in a press release that its domestic box office saw an estimated 122% year-over-year increase versus 2021’s Memorial Day weekend. In all, nearly 4 million guests came to an AMC in the United States to see a movie during the holiday weekend, according the company.
"Top Gun: Maverick" followed the ultra-successful "Doctor Strange in the Multiverse of Madness" and now paves the way for a heavy slate of hot summer titles, including "Jurassic World: Dominion," "Lightyear," "Minions: The Rise of Gru," and "Thor: Love and Thunder."
"It feels a little bit more like a normal summer — summer movie-going has always been a big part of the culture," Box Office Pro Chief Analyst Shawn Robbins previously told Yahoo Finance. "A lot of these movies, pending word of mouth, have that ability to really bring back some of the moviegoing that we haven't seen since 2019."
That potential momentum was not lost on Beynon.
"If we start to see the blockbusters deliver like 'Top Gun: Maverick' did and then, most importantly, if we see some of the mid-tier movies start to bring back those other audiences, I would probably have to reconsider my estimates."
Alexandra is a Senior Entertainment and Food Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 or email her at [email protected]
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