Cineplex (TSE:CGX) Releases Earnings Results

Cineplex (TSE:CGX) announced its quarterly earnings data on Friday. The company reported C$0.34 earnings per share (EPS) for the quarter, FiscalAI reports. The business had revenue of C$440.20 million during the quarter. Cineplex had a positive return on equity of 14.84% and a negative net margin of 0.96%.

Here are the key takeaways from Cineplex’s conference call:

• Record results and stronger finances: Q3 revenue reached CAD 440.2 million, adjusted EBITDAaL more than doubled to CAD 70.7 million, and adjusted free cash flow more than tripled to CAD 52.9 million. Leverage fell to 2.9 times, within the company’s target range.
• Box office momentum and content outlook are encouraging: Cineplex’s Q3 box office revenue rose 35.2%, outperforming the domestic industry, and year-to-date box office revenue through October was up 25%. Management cited a strong year-end slate and a constructive outlook for 2027, while noting film results can be unpredictable.
• Media and location-based entertainment face near-term pressure: Media revenue was flat, with Q4 weighed down by shifted advertiser spending, economic uncertainty, and a tough comparison with pharmaceutical advertising last year. Location-based entertainment revenue declined 1.7% amid cautious consumer spending, although segment EBITDA improved.
• The strategic review remains ongoing, with management considering a broad range of options but providing no update or timeline. Reaching its leverage target gives Cineplex more flexibility to consider capital returns or other uses of cash, but no decision was announced.

Cineplex Stock Up 4.5%

Shares of Cineplex stock traded up C$0.61 during trading on Friday, hitting C$14.25. 1,219,842 shares of the stock traded hands, compared to its average volume of 321,050. The company has a current ratio of 0.44, a quick ratio of 0.22 and a debt-to-equity ratio of -1,865.57. The stock’s fifty day simple moving average is C$12.64 and its 200 day simple moving average is C$11.49. The firm has a market cap of C$897.79 million, a P/E ratio of -71.25, a price-to-earnings-growth ratio of 0.30 and a beta of 0.15. Cineplex has a 52-week low of C$9.15 and a 52-week high of C$14.32.

Wall Street Analyst Weigh In

Several brokerages have commented on CGX. Royal Bank Of Canada increased their target price on Cineplex from C$14.00 to C$15.00 and gave the company an “outperform” rating in a research note on Tuesday, September 15th. Canaccord Genuity Group lifted their price objective on Cineplex from C$11.50 to C$12.25 and gave the company a “hold” rating in a research report on Monday, October 19th. RBC Dominion Securities increased their price target on Cineplex from C$15.00 to C$16.00 and gave the stock an “outperform” rating in a research note on Wednesday, October 28th. National Bank Financial upped their target price on shares of Cineplex from C$13.50 to C$14.00 and gave the stock an “outperform” rating in a research report on Wednesday, August 12th. Finally, TD Securities upgraded Cineplex to a “strong-buy” rating in a report on Friday, July 24th. One investment analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating and one has assigned a Hold rating to the company. According to data from MarketBeat.com, the stock currently has a consensus rating of “Buy” and an average target price of C$14.46.

Cineplex Company Profile

Cineplex (TSX:CGX) is a top-tier Canadian brand that operates in the Film Entertainment and Content, Amusement and Leisure, and Media sectors. Cineplex offers a unique escape from the everyday to millions of guests through its circuit of 169 movie theatres and location-based entertainment venues. In addition to being Canada’s largest and most innovative film exhibitor, the company operates Canada’s favourite destination for ‘Eats & Entertainment’ (The Rec Room), complexes specially designed for teens and families (Playdium), and an entertainment concept that brings movies, amusement gaming, dining, and live performances together under one roof (Cineplex Junxion).