AMC Entertainment (NYSE:AMC) (NYSE:APE) was lifted to Neutral from Underperform with a price target of $19 per share, up from $2 at Wedbush on Thursday.
Analysts told investors in a note they expect AMC shares to settle around their new $19 price target post-conversion and post-reverse-stock-split. AMC's 10-1 reverse split takes effect on Thursday, while the APEs convert on Friday.
"We think AMC is well-positioned against an improving industry backdrop. We expect 2023 North American box office to end up 20% over 2022, or ~78% of 2019 box office, with AMC at least maintaining its 22% market share if not expanding with its vast network of premium large format screens," wrote analysts.
"Moviegoers are finicky with content these days, but we are seeing that they also increasingly opt for premium screens and a larger basket of high-margin concessions. We expect European box office to improve over time as AMC updates its circuit in the region, adding premium screens," they added.
The analysts also noted that AMC's court case resolution removes a significant overhang.