The Christmas debut of Wonder Woman: 1984 at theaters (and on HBO Max) has many analysts seeing hope for the theater industry since the superhero sequel showed there is still significant consumer interest in the big-screen experience.
B. Riley Securities analyst Eric Wold believes IMAX (NYSE:IMAX) may be one of the best-positioned theater operators to capitalize on the enduring demand for showings of films, and he raised his target price on its stock to a street-high $26 per share, up from $18.
In a research note to investors, Wold argues the strong showing by Wonder Woman over the weekend highlights how much consumers want to go to the movies when they're allowed.
Certainly there was a lot of hype around the DC Comics film. And with a dearth of big-budget films after studios pushed all of their releases to 2021, the last of the potential blockbusters to be released this year was going to have a strong showing regardless.
Even though the movie has received less than flattering reviews from both critics and audiences (it has a 62% rating on Rotten Tomatoes, bolstered by early-access reviews from critics who were sure to offer glowing praise), it nonetheless underscores that moviegoers are starved for films.
Wold says IMAX's "improving position" in the sector, along with a slate of IMAX-friendly movies set to premiere next year, position the theater operator as his favorite stock in the space and warrant his higher target price.
His $26 level is 47% higher than where IMAX closed on Tuesday. Its shares were up 5% heading into midday trading Wednesday at over $18.60.