Carmike Cinemas (NASDAQ: CKEC) and AMC Entertainment Holdings (NYSE:AMC) are both cyclical consumer goods & services companies, but which is the superior investment? We will compare the two companies based on the strength of their profitabiliy, analyst recommendations, risk, institutional ownership, dividends, valuation and earnings.

Dividends

AMC Entertainment Holdings pays an annual dividend of $0.80 per share and has a dividend yield of 3.4%. Carmike Cinemas does not pay a dividend. AMC Entertainment Holdings pays out 84.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider and Institutional Ownership

87.5% of Carmike Cinemas shares are held by institutional investors. Comparatively, 41.0% of AMC Entertainment Holdings shares are held by institutional investors. 5.6% of Carmike Cinemas shares are held by company insiders. Comparatively, 0.8% of AMC Entertainment Holdings shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Carmike Cinemas and AMC Entertainment Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Carmike Cinemas -1.56% -1.97% -1.44%
AMC Entertainment Holdings 2.56% 6.52% 1.77%

Volatility & Risk

Carmike Cinemas has a beta of 1.76, suggesting that its share price is 76% more volatile than the S&P 500. Comparatively, AMC Entertainment Holdings has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Carmike Cinemas and AMC Entertainment Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Carmike Cinemas 0 2 0 0 2.00
AMC Entertainment Holdings 1 1 10 0 2.75

Carmike Cinemas presently has a consensus price target of $32.88, indicating a potential downside of 1.57%. AMC Entertainment Holdings has a consensus price target of $36.48, indicating a potential upside of 54.56%. Given AMC Entertainment Holdings’ stronger consensus rating and higher possible upside, analysts plainly believe AMC Entertainment Holdings is more favorable than Carmike Cinemas.

Valuation & Earnings

This table compares Carmike Cinemas and AMC Entertainment Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Carmike Cinemas N/A N/A N/A $0.23 145.22
AMC Entertainment Holdings $3.75 billion 0.82 $642.94 million $0.95 24.84

AMC Entertainment Holdings has higher revenue and earnings than Carmike Cinemas. AMC Entertainment Holdings is trading at a lower price-to-earnings ratio than Carmike Cinemas, indicating that it is currently the more affordable of the two stocks.

Summary

AMC Entertainment Holdings beats Carmike Cinemas on 9 of the 13 factors compared between the two stocks.

Carmike Cinemas Company Profile

Carmike Cinemas, Inc. is a motion picture exhibitor company. The Company owns and operates theatres and screens. Its theatres are equipped to provide digital cinema. It owns, operates or has an interest in approximately 280 theatres with over 2,940 screens located in over 40 states. In addition, it has approximately 260 theatres with over 1,090 screens equipped for three dimension (3-D). It operates approximately 20 theatres with over 110 screens as discount theatres. It operates approximately 50 premium large-format auditoriums, which operate under the Big D, IMAX and MuviXL names. Big D auditoriums include wall to wall screens, approximately 7.1 surround sound and digital projection for both two dimensional (2-D) and 3-D features. The Company operates a family entertainment center under the name Hollywood Connection, which features a multiplex theatre and other forms of family entertainment. The Company also operates over two Bogart’s Bar and Grill Restaurants.

AMC Entertainment Holdings Company Profile

AMC Entertainment Holdings, Inc. is a holding company. The Company, through its subsidiaries, including AMC Entertainment Inc. (AMCE), American Multi-Cinema, Inc. (OpCo) and its subsidiaries, is engaged in the theatrical exhibition business. It operates through theatrical exhibition operations segment. It licenses first-run motion pictures from distributors owned by film production companies and from independent distributors. The Company also offers a range of food and beverage items, which include popcorn; soft drinks; candy; hot dogs; specialty drinks, including beers, wine and mixed drinks, and made to order hot foods, including menu choices, such as curly fries, chicken tenders and mozzarella sticks. It operates over 900 theatres with approximately 10,000 screens globally, including over 661 theatres with approximately 8,200 screens in the United States and over 244 theatres with approximately 2,200 screens in Europe. The Company’s subsidiary also includes Carmike Cinemas, Inc.

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