The market appears to be too optimistic about the recovery for movie theaters and investors should dump their positions in Imax and Cinemark, according to Goldman Sachs.
Theaters are coming off their best weekend since the pandemic hit the U.S., with the success “A Quiet Place Part II” helping the industry generate more than $100 million over four days. The move made $5.3 million at Imax alone, according to the theater company.
However, analyst Michael Ng downgraded Imax and Cinemark to sell from neutral, saying in a note to clients on Wednesday that the stocks appeared overvalued and investors should look for entertainment exposure in other sectors.
