AMC Vs. Lions Gate: Which Entertainment Stock Is A Better Buy?

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Despite the rising popularity of various over the top (OTT) platforms over the past year, the reopening of movie theaters and other location-based entertainment operations is expected to help AMC Entertainment (AMC) and Lions Gate (LGF-A) recover significantly this year. But let’s find out which of these stocks is a better buy now.

AMC Entertainment Holdings, Inc.  is a theatrical exhibition company that operates globally. It licenses first-run films from distributors owned by film production companies and from independent distributors on a film-by-film and theatre-by-theater basis. It also offers food and beverages. .

Lions Gate Entertainment Corp. engages in motion picture production and distribution, television programming and syndication, home entertainment, interactive ventures and games, and location-based entertainment operations internationally. The company operates through three segments—Motion Picture, Television Production, and Media Networks. The company releases in-house motion pictures theatrically, as well as films acquired from third parties.

As the U.S. economy experiences a fast-paced recovery, entertainment companies are likely to generate increasing foot traffic. So, both AMC and LGF.A’s financials are expected to recover in the coming quarters.

While AMC lost 11.8% over the past month, LGF.A lost 5.7%. In terms of their past year’s performance, AMC’s 129.6% makes it a clear winner given LGF.A’s 111.5% gain. But, which of these stocks is a better pick now? Let’s find out.

Latest Movements

To bolster its cash reserves, AMC filed a shelf registration with the U.S. Securities and Exchange Commission (SEC) on April 27 to permit the issuance and sale of up to 43 million shares of the company’s Class A Common Stock through an “at-the-market” equity offering program. The company hopes that the sale of these shares will satisfy its liquidity needs for 2021 and its  movie theater recovery  in the second half of this year.

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