Why Cinemark Stock Tumbled by Almost 20% This Week
People love going to the movies, but lately they haven't been loving it enough to boost the movie theater industry. On the back of a worrying analyst report about recent movie theater attendance, prominent cinema chain operator Cinemark Holdings (NYSE: CNK) really took it on the chin this week. According to data compiled by S&P Global Market Intelligence, the company's share price declined by more than 18% during the period.
That analysis was published early Tuesday by investment bank Goldman Sachs. Its analyst Michael Ng wrote that total box office sales for the third quarter of this year were a steep 32% below pre-pandemic levels. In fact, if the cornavirus-ravaged 2020 quarter is excluded, this past third quarter was the worst one for the industry since 1996.
Ng did not mince words about what this might mean for Cinemark and its peers: "Although the timing of content and production delays likely negatively impacted box office in [the 2022 third quarter], the magnitude of underperformance creates uncertainty on whether the domestic box office should see any outsized recovery in the near future."
Source Fool.com
