AMC Entertainment Holdings (NYSE: AMC) and Regal Entertainment Group (NYSE:RGC) are both mid-cap consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitabiliy and dividends.

Institutional & Insider Ownership

41.0% of AMC Entertainment Holdings shares are held by institutional investors. Comparatively, 76.8% of Regal Entertainment Group shares are held by institutional investors. 0.8% of AMC Entertainment Holdings shares are held by company insiders. Comparatively, 2.0% of Regal Entertainment Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares AMC Entertainment Holdings and Regal Entertainment Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AMC Entertainment Holdings $3.75 billion 0.72 $642.94 million $0.95 21.68
Regal Entertainment Group $3.23 billion 0.96 $597.40 million $1.13 17.56

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

Analyst Ratings

This is a summary of current recommendations and price targets for AMC Entertainment Holdings and Regal Entertainment Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AMC Entertainment Holdings 1 2 9 0 2.67
Regal Entertainment Group 3 3 6 1 2.38

AMC Entertainment Holdings presently has a consensus target price of $35.64, indicating a potential upside of 73.02%. Regal Entertainment Group has a consensus target price of $24.85, indicating a potential upside of 25.23%. Given AMC Entertainment Holdings’ stronger consensus rating and higher probable upside, equities analysts clearly believe AMC Entertainment Holdings is more favorable than Regal Entertainment Group.

Volatility & Risk

AMC Entertainment Holdings has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500. Comparatively, Regal Entertainment Group has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Dividends

AMC Entertainment Holdings pays an annual dividend of $0.80 per share and has a dividend yield of 3.9%. Regal Entertainment Group pays an annual dividend of $0.88 per share and has a dividend yield of 4.4%. 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. Regal Entertainment Group pays out 77.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Regal Entertainment Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares AMC Entertainment Holdings and Regal Entertainment Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AMC Entertainment Holdings 2.56% 6.52% 1.77%
Regal Entertainment Group 5.51% -21.38% 7.00%

Summary

Regal Entertainment Group beats AMC Entertainment Holdings on 9 of the 17 factors compared between the two stocks.

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.

Regal Entertainment Group Company Profile

Regal Entertainment Group is an operator of theatre circuits in the United States. As of March 31, 2017, the Company operated 7,262 screens in 559 theatres in 43 states along with Guam, Saipan, American Samoa and the District of Columbia. The Company manages its business under theatre exhibition operations segment. The Company develops, acquires and operates multi-screen theatres primarily in mid-sized metropolitan markets and suburban growth areas of metropolitan markets throughout the United States. The Company operates multi-screen theatres. The Company is the parent company of Regal Entertainment Holdings, Inc. (REH), which is the parent company of Regal Cinemas Corporation (Regal Cinemas) and its subsidiaries. Regal Cinemas’ subsidiaries include Regal Cinemas, Inc. (RCI) and its subsidiaries, which include Edwards Theatres, Inc. (Edwards), Regal CineMedia Corporation (RCM) and United Artists Theatre Company (United Artists).

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