Is Cinemark Holdings Inc. (CNK) positioned for future growth?

Cinemark Holdings Inc. (NYSE: CNK) stock jumped 1.36% on Monday to $11.19 against a previous-day closing price of $11.04. With 1.99 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.53 million shares. During the session, the Entertainment company that operates in wider Communication Services sector, reached to the highest price of $11.38 whereas the lowest price it dropped to was $10.99. The 52-week range on CNK shows that it touched its highest point at $19.76 and its lowest point at $8.28 during that stretch. It currently has a 1-year price target of $14.33. Beta for the stock currently stands at 2.20.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CNK was up-trending over the past week, with a rise of 3.52%, but this was up by 21.50% over a month. Three-month performance surged to 22.30% while six-month performance fell -40.86%. The stock lost -31.48% in the past year, while it has gained 29.21% so far this year. A look at the trailing 12-month EPS for CNK yields -1.39 with Next year EPS estimates of 0.35. For the next quarter, that number is -0.04. This implies an EPS growth rate of 48.20% for this year and 123.30% for next year. EPS is expected to grow by 10.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -29.30%.

Float and Shares Shorts:

At present, 118.40 million CNK shares are outstanding with a float of 108.30 million shares on hand for trading. On Oct 13, 2022, short shares totaled 21.67 million, which was 17.97% higher than short shares on Sep 14, 2022. In addition to Mr. Sean Gamble as the firm’s CEO, Pres & Director, Mr. Lee Roy Mitchell serves as its Founder & Director.


Institutional Ownership:

Through their ownership of 104.96% of CNK’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 55.38% of CNK, in contrast to 51.51% held by mutual funds. Shares owned by individuals account for 25.10%. As the largest shareholder in CNK with 13.37% of the stake, BlackRock Fund Advisors holds 16,101,293 shares worth 16,101,293. A second-largest stockholder of CNK, Wellington Management Co. LLP, holds 12,722,193 shares, controlling over 10.56% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in CNK, holding 12,138,345 shares or 10.08% stake. With a 6.58% stake in CNK, the iShares Core S&P Small Cap ETF is the largest stakeholder. A total of 7,928,529 shares are owned by the mutual fund manager. The GBM 106 SA de CV SIRV, which owns about 4.92% of CNK stock, is the second-largest Mutual Fund holder. It holds 5,920,000 shares valued at 51.27 million. Vanguard Explorer Fund holds 3.39% of the stake in CNK, owning 4,080,140 shares worth 35.33 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CNK since 12 analysts follow the stock currently. There are 7 analysts who recommend BUY ratings, while 2 suggest SELL ratings. Of the remaining analysts, 3 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CNK analysts setting a high price target of $18.00 and a low target of $9.00, the average target price over the next 12 months is $14.08. Based on these targets, CNK could surge 60.86% to reach the target high and fall by -19.57% to reach the target low. Reaching the average price target will result in a growth of 25.83% from current levels.


EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CNK will report FY 2022 earnings on 02/23/2024. Analysts have provided yearly estimates in a range of -$0.95 being high and -$1.88 being low. For CNK, this leads to a yearly average estimate of -$1.38. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Cinemark Holdings Inc. surprised analysts by -$0.04 when it reported -$0.20 EPS against a consensus estimate of -$0.16. The surprise factor in the prior quarter was -$0.84. Based on analyst estimates, the high estimate for the next quarter is $0.26 and the low estimate is -$0.45. The average estimate for the next quarter is thus -$0.06.

Summary of Insider Activity:

Insiders traded CNK stock several times over the past three months with 0 Buys and 2 Sells. In these transactions, 0 shares were bought while 52,957 shares were sold. The number of buy transactions has increased to 15 while that of sell transactions has risen to 24 over the past year. The total number of shares bought during that period was 239,877 while 109,227 shares were sold.

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