AMC Stock Forecast: Will the Rally Continue After Wedbush Upgrade?

In this article, we take a closer look at AMC stock, with a particular focus on the recent upgrade it received from Wedbush and the rally that followed. The key question now is that can AMC sustain this upward momentum, or is it just a temporary bounce?

AMC Entertainment Holdings, Inc. (NYSE:AMC) is one of the world’s largest movie theater chains, operating more than 900 locations across the United States and Europe. Founded in 1920 and headquartered in Leawood, Kansas, the company has played a central role in shaping the cinematic experience for over a century. Today, AMC is navigating a rapidly evolving entertainment landscape while aiming to regain its financial footing.

In this article, we take a deep dive into AMC stock, analyzing its recent performance, financial health, and growth outlook heading into 2025. Whether you're a long term investor or simply tracking the entertainment sector, understanding the fundamentals of AMC stock is essential to making informed decisions. From box office trends to debt reduction and strategic expansion, we break down what’s driving the company’s latest momentum.

AMC Stock Forecast: Will the Rally Continue After Wedbush Upgrade?

AMC Entertainment Holdings, Inc. (NYSE:AMC)

AMC Stock Gets a Boost from Wedbush

AMC Entertainment Holdings, Inc. (NYSE:AMC) is back in the spotlight. On July 10, AMC Entertainment Holdings, Inc. (NYSE:AMC) received an upgrade from Wedbush Securities, lifting its rating to Outperform from Neutral with a new price target of $4, up from $3. The upgrade reflects AMC’s improving financials, a stronger film release slate, and international growth plans. Wedbush noted the company has restructured its debt, eliminating 2026 maturities, and is nearing the end of equity offerings. A steadier movie schedule is expected to boost consistent ticket sales. AMC also aims to expand across Europe and the U.K., leveraging its premium screens. These moves position AMC to capture more market share in 2025 - 2026.

This bullish shift comes amid a broader rally in the stock, but investors are wondering: is this momentum sustainable, or is it just a short lived spike?

Breaking Down AMC Stock's Q1 2025 Earnings

Let’s break down AMC's Q1 2025 earnings to get a clearer picture.

First off, Q1 was tough across the industry. Domestic box office receipts hit their lowest non COVID level since 1996. AMC Entertainment Holdings, Inc. (NYSE:AMC), however, showed surprising resilience, outperforming the industry with a 10.9% drop in admissions revenue, versus a 12.4% industry decline. Management argues that Q1 was an outlier and that the box office is already bouncing back, April and May's numbers have doubled year over year.

AMC Stock Revenue and Profitability Metrics

AMC Entertainment Holdings, Inc. (NYSE:AMC) surprised analysts in Q1 2025, posting $862.5 million in revenue, about $25 million more than expected. The company also beat EPS estimates, reporting a loss of $0.58 per share, slightly better than Wall Street’s prediction. However, year over year, revenue still dropped 9.3%, reflecting a tough start to the year for the movie industry.

But there’s a bright spot, AMC Entertainment Holdings, Inc. (NYSE:AMC) is earning more per moviegoer than ever before. In the U.S., admission revenue per patron hit a record $12.31 for Q1, while food and beverage sales per customer jumped 49% compared to 2019. Contribution margin per guest also soared 51% above pre pandemic levels, showing real progress in profitability per visit.

Looking at the full year 2024, AMC reported $4.64 billion in total revenue, slightly down from $4.81 billion in 2023. This slowdown suggests that the post COVID recovery may be leveling off. Still, the company’s $641.5 million in gross profit marks a major turnaround from pandemic era losses, driven by better cost control and premium offerings.

That said, AMC Entertainment Holdings, Inc. (NYSE:AMC) still posted a net loss of $352.6 million in 2024. High interest payments and ongoing costs continue to weigh down results, keeping the stock in speculative territory for now.

AMC's Balance Sheet and Debt Reduction

From a balance sheet perspective, AMC Entertainment Holdings, Inc. (NYSE:AMC) ended the Q1, 2025 with $378.7 million in cash and equivalents. Debt reduction remains a priority, with the company cutting over $1.3 billion in debt and deferred rent since early 2022. CapEx is expected to range between $175 million and $225 million this year, signaling ongoing investment in premium formats and new theater technologies.

On an yearly basis, AMC Entertainment Holdings, Inc. (NYSE:AMC) has significantly reduced its total debt, with long term debt falling from $5.12 billion in 2021 to $4.01 billion in 2024, showing steady deleveraging. However, cash reserves have sharply declined from $1.59 billion in 2021 to $632.3 million in 2024, raising concerns about liquidity and operational flexibility. AMC Entertainment Holdings, Inc. (NYSE:AMC) total equity remains deeply negative at -$1.76 billion in 2024, reflecting accumulated losses and highlighting its ongoing financial challenges.

Strategic Expansion and Customer Growth

AMC Entertainment Holdings, Inc. (NYSE:AMC) is going all in on its “Go Plan,” a strategy focused on upgrading theaters and enhancing the moviegoing experience. The company is expanding its premium screen offerings, like IMAX with Laser, Dolby Cinema, and the new XL and Club Rocker formats, to over 1,000 screens in the coming years.

AMC Entertainment Holdings, Inc. (NYSE:AMC) is also improving comfort with its new Club Rocker seats, already boosting performance at top locations like Lincoln Square and Burbank. At the same time, its loyalty programs are getting smarter. A new tier, AMC Stubs Premiere GO, and updates to the A List subscription are designed to reward frequent moviegoers and attract more members.

AMC is expanding internationally by rolling out premium formats like ScreenX and 4DX across Europe, with 71 new auditoriums planned in partnership with CJ 4DPLEX. The company has already piloted 65 successful XL screens in Europe and plans to scale further based on strong guest feedback. These efforts aim to boost attendance and revenue in key global markets while maintaining capital efficiency.

These moves are capital efficient and aimed at increasing customer satisfaction and per patron spending. With better screens, better seats, and more rewarding programs, AMC is positioning itself for growth in 2025 and beyond, no matter how the box office ebbs and flows.

AMC Stock Outlook: Is the Rally Sustainable?

So, will the rally continue?

Fundamentally, AMC Entertainment Holdings, Inc. (NYSE:AMC) is stronger than it was a year ago. The stock is still speculative, given ongoing cash burn and inconsistent profitability, but the underlying business is stabilizing. The company is improving margins, trimming debt, and positioning itself for long term growth through premium offerings and international expansion. If the box office continues its recovery, which early Q2 numbers suggest it will, AMC may finally be entering a more sustainable phase of growth.

In short, the Wedbush upgrade appears justified. While not without risk, AMC Entertainment Holdings, Inc. (NYSE:AMC) improving fundamentals and strategic execution offer a cautiously optimistic outlook. Long term investors should watch cash flow and box office trends closely, but for now, the rally has legs.

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Disclaimer: None. The article is originally published on TheRichStocks.com.