There's a lot to love about Regal Entertainment (NYSE: RGC). The largest theater operator in the United States offers compelling growth in a mature market via ancillary revenue streams and bolt-on acquisitions. Beyond its appeal to growth investors, the company pays a very attractive dividend, and investors can pick up a piece of this well-managed, industry-leading business for 14 times forward estimated earnings. The movie industry can be risky, but the box office continues to be one area where the numbers only seem to rise. With the summer blockbuster season on tap, Regal Cinemas has even brighter days ahead.

The results are in
Though the generally accepted accounting principles bottom line actually came in at a loss, Regal Cinemas' first-quarter results proved hardy. The company grew revenue by 13% and adjusted EBITDA by 19.8%, while also growing free cash flow. The acquisition of the 500-plus screen Hollywood Theaters, priced at $238 million (and only $191 million in cash) looks to have been a great use of capital. 

Even though the box office ticket prices have been steadily increasing over the long term (receipts grew 7.5% in the most recent quarter), the mature U.S. theater market requires that the big players turn to nonorganic factors to drive growth. As a well-capitalized industry behemoth, Regal remains in top position to benefit from the trend of consolidation and market share grabs.

Regal noted higher ticket sales due to a strong slate of family oriented films. The top 10 grossing films for the quarter included three animated family films. Clearly, fun for the whole family equates to good times for the theater chains. The broader growth driver for box office revenue, though, is premium experiences that yield premium ticket prices. IMAX screens, 3-D films, and a shift to all-digital projection systems have allowed Regal to charge more for each ticket. At various times in the past, that has more than compensated for lower ticket sales.

Coming soon
As has been the case for some time, Regal is focusing on continued screen acquisition at the macro level and customer-experience refinements on the unit level. Concessions remain a high-growth area for the business, with sales increasing by nearly 17% in the most recent quarter. Regal has expanded its food and beverage offerings to address a more discerning consumer, and the result is higher margins with low up-front investment for additions such as alcoholic beverages.

Regal is also installing larger, more comfortable seats in theaters that have been through the majority of their useful life -- a minimal capital investment that can extend the life of the asset.

On the film end, we are headed into summer blockbuster season. With (unfortunately) another round of superhero movies on the way, alongside plenty of sequels, the box office will be raking it in. Investors will want to keep an eye on how these films perform, especially 3-D and IMAX ticket sales. Concession sales should continue their upward trajectory nicely, and the company is working on opening seven to nine new theaters with a net screen addition in the neighborhood of 20-40.

All in all, things look great for this well-priced, 4.7% dividend-paying stock. Investors compelled by relative low-risk, income-generating picks should take a close look.