Financial Review: Cinemark Holdings (NYSE:CNK) versus Carmike Cinemas (CKEC)
Cinemark Holdings (NYSE: CNK) and Carmike Cinemas (NASDAQ:CKEC) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitabiliy and risk.
Insider & Institutional Ownership
89.4% of Cinemark Holdings shares are owned by institutional investors. Comparatively, 87.5% of Carmike Cinemas shares are owned by institutional investors. 9.2% of Cinemark Holdings shares are owned by company insiders. Comparatively, 5.6% of Carmike Cinemas shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This is a summary of recent ratings and target prices for Cinemark Holdings and Carmike Cinemas, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Cinemark Holdings currently has a consensus price target of $43.57, indicating a potential upside of 13.41%. Carmike Cinemas has a consensus price target of $32.88, indicating a potential downside of 1.57%. Given Cinemark Holdings’ stronger consensus rating and higher possible upside, analysts clearly believe Cinemark Holdings is more favorable than Carmike Cinemas.
Earnings and Valuation
This table compares Cinemark Holdings and Carmike Cinemas’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Cinemark Holdings||$2.99 billion||1.49||$682.09 million||$2.36||16.28|
Cinemark Holdings has higher revenue and earnings than Carmike Cinemas. Cinemark 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.
Volatility & Risk
Cinemark Holdings has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500. Comparatively, Carmike Cinemas has a beta of 1.76, meaning that its stock price is 76% more volatile than the S&P 500.
This table compares Cinemark Holdings and Carmike Cinemas’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Cinemark Holdings pays an annual dividend of $1.16 per share and has a dividend yield of 3.0%. Carmike Cinemas does not pay a dividend. Cinemark Holdings pays out 49.2% of its earnings in the form of a dividend.
Cinemark Holdings beats Carmike Cinemas on 11 of the 13 factors compared between the two stocks.
About Cinemark Holdings
Cinemark Holdings, Inc. is engaged in the motion picture exhibition business with theatres in the United States (U.S.), Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Paraguay, Curacao and Bolivia. The Company manages its business in two segments: U.S. markets and international markets. The international segment consists of operations in Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay. As of December 31, 2016, the Company operated 526 theatres and 5,903 screens in the United States and Latin America. As of December 31, 2016, its the United States circuit had 339 theatres and 4,559 screens in 41 states and its international circuit had 187 theatres and 1,344 screens in 15 countries. It develops new platforms for its theatre circuit, such as XD, Cinemark Reserve, Luxury Lounger reclining seats, CineArts and other concepts.
About Carmike Cinemas
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.
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