JP Morgan upgrades Cinemark on improving 2026-27 film slate visibility

Investing.comApr 11, 2025 6:08 PM

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Investing.com -- JP Morgan upgraded Cinemark Holdings (NYSE:CNK) to “Overweight” from “Neutral” on growing confidence in the 2026-2027 film pipeline and reduced box office expectations for 2025 that now better align with the bank’s forecasts.

JP Morgan also noted that market expectations have adjusted for potential share loss as theater capacity tightens, a dynamic it had previously flagged as a risk.

On the positive side, visibility into future supply has improved meaningfully, particularly following updates from CinemaCon.

Amazon (NASDAQ:AMZN) MGM’s commitment to produce 15 theatrical films annually by 2027 offers a replacement for lost 20th Century Fox output, which has weighed on the industry since Disney’s 2017 acquisition, the bank said.

Channel checks with entertainment executives further support a healthy pipeline of upcoming projects.

JP Morgan also pointed to Cinemark’s limited economic sensitivity, noting that theater attendance tends to correlate more with film quality than macroeconomic conditions.

As an example, the firm cited Minecraft’s $162 million opening weekend, which came despite broader market volatility.

While concerns remain around shortened theatrical windows and their effect on mid-budget films, the bank said it was encouraged by studios’ efforts to simplify and extend exclusivity periods.

It set a December 2025 price target of $34, valuing the stock at the midpoint of a 6.5x–8.5x range and incorporating potential dilution or payout from convertibles.

JP Morgan maintained a Neutral rating on IMAX (NYSE:IMAX) citing risks tied to China and exhibitor capital spending.

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