Investors should snap up beat-down Marcus Corporation shares as the film industry continues rebounding, according to Benchmark. Analyst Mike Hickey named Marcus a top idea for 2024. Hickey’s $18 price target reflects the potential for shares to soar 45.4% from where the stock finished last week. The stock has notably underperformed other movie theater-related stocks this year, which Hickey said has given investors a good spot to buy in at. While Marcus stock has slipped more than 13% in 2024, rivals Cinemark and Imax have climbed more than 59% and 36%, respectively. “We believe Marcus offers a compelling catch-up trade,” Hickey told clients in a Sunday note. There is “no reason for the market to abandon the company’s valuation, as it is well-positioned to benefit from the strong return of film products and market growth.” MCS CNK,IMAX YTD mountain Marcus vs. Cinemark and Imax in 2024 Notably, Marcus is much smaller than these other names. Marcus has a market cap under $500 million, while Imax and Cinemark are worth more than $1 billion and $2.7 billion, respectively. Similar to other movie theater operators, Hickey said Marcus took a hit with the Covid-19 pandemic and, more recently, the Hollywood strikes last summer that ground production to a halt. He noted the stock’s valuation has been hurt by a tough second-quarter box office. However, he said there are bright spots ahead with the performance of “Deadpool & Wolverine.” Marcus’ removal from the S & P 600 and its repurchase of convertible notes also negatively affected the stock, Hickey said. Hickey pointed to expansion plans within the film business as a reason for optimism. Specifically, he cited the takeover of a Minnesota theater, which reopened under the Marcus brand earlier this month. Marcus, which also operates hotels and restaurants, rose more than 1% on Monday. The Wisconsin-based company reports earnings Thursday.
