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Marcus Stock Hits 52-Week High: Should You Wait for a Dip or Buy Now?
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Shares of The Marcus Corporation (MCS - Free Report) touched a new 52-week high of $16.17 on Wednesday. The stock pulled back to end the trading session at $16.09.
The company’s shares have surged 44% in the past three months, outpacing the industry’s gain of 11.1%. The stock has also outperformed the S&P 500 and the Consumer Discretionary sector’s increase of 2.6% and 7.6%, respectively. In the same time frame, other stocks like AMC Entertainment Holdings, Inc. (AMC - Free Report) , Target Hospitality Corp. (TH - Free Report) and Six Flags Entertainment Corporation (FUN - Free Report) have declined 13.1%, 11.4% and 32.3%, respectively.
Stock Price Performance
Image Source: Zacks Investment Research
Technical indicators suggest continued strong performance for MCS. The stock is trading above its 50-day moving average, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in MCS' financial health and prospects.
50-Day Moving Average
Image Source: Zacks Investment Research
What’s Behind MCS Upsurge?
The company is benefiting from robust box office performance. In its theater division, MCS saw an upside in performance in June. The company is benefiting from targeted promotions such as the $7 everyday matinee offer for seniors and children. The reintroduction of free popcorn for loyalty members on value Tuesdays also helped boost attendance. The release of high-performing films like Inside Out 2 further contributed to improved box office results, as audiences returned to theaters when stronger film offerings were available.
The company expanded its theater portfolio by reopening a new cinema in St. Louis Park, MN, offering its popular programs and loyalty rewards. This marked a positive step in growing the theater business despite broader challenges in the industry.
Robust performance of the Hotels & Resorts division bodes well for the company. During second-quarter 2024, the Hotels & Resorts division witnessed revenue growth of 6.3%, driven by a 6.5% increase in RevPAR across five of its seven owned hotels. Occupancy reached 72.7%, the highest since the pandemic.
In the second quarter of 2024, the company observed a notable trend in group business, with group rooms constituting 44.6% of the total room mix, a significant rise from 40.1% in the same period last year. This shift led to a slight decline in the average daily rate (ADR), attributed to the higher proportion of group rooms within the overall room revenue mix. The increase in midweek group room bookings contributed to this trend, enhancing occupancy levels, albeit at lower rates.
The company is optimistic about the second half of 2024 and beyond, expecting strong performance in both the hotel and theater segments. Group bookings for the remainder of fiscal 2024 are approximately 11% ahead of the previous year, with fiscal 2025 bookings running over 36% higher, signaling robust demand. With the anticipated film slate and enhanced promotions, MCS is confident in regaining momentum in its theater business, projecting a more favorable operational environment in 2025.
MCS Trading at a Discount
The company is currently valued at a discount compared with the industry on a forward 12-month P/S basis. MCS’ forward 12-month price-to-sales ratio stands at 0.7, lower than the industry’s ratio of 1.59 and the S&P 500's ratio of 5.11.
End Notes
MCS presents a compelling investment opportunity, reflected in its recent share performance. This growth is underpinned by strong box office performance and strategic promotions that have successfully driven attendance in its theater division, alongside robust revenue growth. With increasing occupancy and a notable rise in group bookings, the company is well-positioned for sustained growth. Furthermore, MCS is trading at a discount relative to its industry peers, making it an attractive buy for investors seeking value in a recovery-oriented market. Overall, the combination of positive operational trends, a strong outlook and undervaluation compared to the market underscores why investors should consider adding this Zacks Rank #2 (Buy) stock to their portfolios.
Image: Bigstock
Marcus Stock Hits 52-Week High: Should You Wait for a Dip or Buy Now?
Shares of The Marcus Corporation (MCS - Free Report) touched a new 52-week high of $16.17 on Wednesday. The stock pulled back to end the trading session at $16.09.
The company’s shares have surged 44% in the past three months, outpacing the industry’s gain of 11.1%. The stock has also outperformed the S&P 500 and the Consumer Discretionary sector’s increase of 2.6% and 7.6%, respectively. In the same time frame, other stocks like AMC Entertainment Holdings, Inc. (AMC - Free Report) , Target Hospitality Corp. (TH - Free Report) and Six Flags Entertainment Corporation (FUN - Free Report) have declined 13.1%, 11.4% and 32.3%, respectively.
Stock Price Performance
Image Source: Zacks Investment Research
Technical indicators suggest continued strong performance for MCS. The stock is trading above its 50-day moving average, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in MCS' financial health and prospects.
50-Day Moving Average
Image Source: Zacks Investment Research
What’s Behind MCS Upsurge?
The company is benefiting from robust box office performance. In its theater division, MCS saw an upside in performance in June. The company is benefiting from targeted promotions such as the $7 everyday matinee offer for seniors and children. The reintroduction of free popcorn for loyalty members on value Tuesdays also helped boost attendance. The release of high-performing films like Inside Out 2 further contributed to improved box office results, as audiences returned to theaters when stronger film offerings were available.
The company expanded its theater portfolio by reopening a new cinema in St. Louis Park, MN, offering its popular programs and loyalty rewards. This marked a positive step in growing the theater business despite broader challenges in the industry.
Robust performance of the Hotels & Resorts division bodes well for the company. During second-quarter 2024, the Hotels & Resorts division witnessed revenue growth of 6.3%, driven by a 6.5% increase in RevPAR across five of its seven owned hotels. Occupancy reached 72.7%, the highest since the pandemic.
In the second quarter of 2024, the company observed a notable trend in group business, with group rooms constituting 44.6% of the total room mix, a significant rise from 40.1% in the same period last year. This shift led to a slight decline in the average daily rate (ADR), attributed to the higher proportion of group rooms within the overall room revenue mix. The increase in midweek group room bookings contributed to this trend, enhancing occupancy levels, albeit at lower rates.
The company is optimistic about the second half of 2024 and beyond, expecting strong performance in both the hotel and theater segments. Group bookings for the remainder of fiscal 2024 are approximately 11% ahead of the previous year, with fiscal 2025 bookings running over 36% higher, signaling robust demand. With the anticipated film slate and enhanced promotions, MCS is confident in regaining momentum in its theater business, projecting a more favorable operational environment in 2025.
MCS Trading at a Discount
The company is currently valued at a discount compared with the industry on a forward 12-month P/S basis. MCS’ forward 12-month price-to-sales ratio stands at 0.7, lower than the industry’s ratio of 1.59 and the S&P 500's ratio of 5.11.
End Notes
MCS presents a compelling investment opportunity, reflected in its recent share performance. This growth is underpinned by strong box office performance and strategic promotions that have successfully driven attendance in its theater division, alongside robust revenue growth. With increasing occupancy and a notable rise in group bookings, the company is well-positioned for sustained growth. Furthermore, MCS is trading at a discount relative to its industry peers, making it an attractive buy for investors seeking value in a recovery-oriented market. Overall, the combination of positive operational trends, a strong outlook and undervaluation compared to the market underscores why investors should consider adding this Zacks Rank #2 (Buy) stock to their portfolios.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.