On Monday, the Standard & Poor’s Ratings Service raised its outlook on the movie theater chain citing its recent box office receipts and debt reduction.
Carmike operates 250 theaters and nearly 2,300 screens in 36 states, with a focus on small and mid-sized communities.
Credit analyst Jeanne Mathewson stated in a note: “We believe that the company’s cushion of compliance could increase further if strong box office and operating performance continues.”
Earlier this year, Merriman Curhan Ford analyst Eric Wold reiterated his “Buy” rating for Carmike shares, saying that the company’s domestic box office revenues rose 9 percent to 10 percent in the first quarter despite a lineup of movies that he considered “fairly lackluster.”
We’re only in the second week of June and there are already a handful movies that have grossed more than $100 million in less than a month of being released, and many more like Star Trek, and Angels and Demons, which continue to gross big numbers despite tough competition.
Carmike was first named a Buzz Stock, when shares were trading at $3.42 a share. Loyal readers are enjoying a hefty 126 percent gain.
We’re bullish on Carmike through the end of the Summer, and we’ll keep you posted on whether we see any good trailers for movies coming out in the fall.
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