When Carmike Cinemas reports its quarterly and full-year 2011 earnings data on March 12, it could very well set the stage for a classic movie scenario: A rising star takes his or her lumps, seemingly down for the count, then staggers back to their feet to pull off a rousing comeback.
That is shaping up to be a possibility as Columbus-based Carmike prepares to issue its financial information on March 12. A stable of 10 Wall Street analysts are currently projecting the company will earn 8 cents per share in the October-December quarter, according to surveys by research firm Thomson Financial.
But the expectations are dicier from there, with those market experts expecting an average loss of 64 cents per share for all of 2011, followed by a loss of 41 cents per share in the first quarter of this year.
Is the plot thickening to doom and gloom? Not according to a recent research report issued on Carmike by Raymond James research analyst Joseph Hovorka.
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“We believe CKEC remains undervalued. The company’s balance sheet continues to improve and average screen count increased in 3Q11 for the first time since 1Q09,” he wrote, stressing he is keeping a “strong buy” rating on the stock.
That indicates shares are expected to yield a total return of at least 15 percent over the next six to 12 months.
Raymond James now has a 52-week price target of $16 per share on the stock.
Carmike operates 235 theaters (with 2,215 screens) in 36 states, as of the end of September.
Of those screens, nearly 2,100 are digital, while 726 are equipped to show 3-D movies and other programming.
Hovorka does list Carmike as a “high risk” stock, citing the high amount of debt it carries.
He also noted that the U.S. box office “disappointed” in the fourth quarter, declining more than 5 percent.
But 2012 has started off strong, he wrote, and Carmike has a distinct upside.
While the Thomson Financial consensus is for Carmike to post a profit of 61 cents for all of 2012, he sees the motion-picture exhibitor making 71 cents per share.
For 2013, he anticipates net earnings of 95 cents per share.
Shares of Carmike (Ticker: CKEC) have been trading in a range of $5.14 to $7.95 per share over the last 52 weeks.
On Tuesday, they closed down 16 cents, or 2.1 percent, to $7.47 on the Nasdaq exchange.