Cineworld’s shares, which have already more than tripled from a low of 25p last October, jumped by another 4% early this week, says Naomi Ackerman in the Evening Standard: box-office receipts for the first weekend after cinemas were allowed to reopen in the UK “smashed expectations”. Not only has attendance “soared”, but revenues were increased further by punters “splashing out on popcorn and other treats”. All this raises hopes that the chain can recover from a disastrous 2020, when it suffered an “eye-watering” £1.7bn loss and was forced to seek a £900m bailout from investors.
It’s not just the UK powering Cineworld’s recovery, says James Warrington in CityAM. The reopening of 167 cinemas in the US means that 97% of its screens are now active, while restrictions are due to be relaxed in Poland and Israel. CEO Mooky Greidinger expects a “good recovery in attendance over the coming months” thanks to a “full slate of films” including action-thriller F9, which has already had “record breaking” success in Asia. While cinemas face intensifying competition from the rise of streaming services, Cineworld has signed an “exclusive deal” with Warner Bros securing a 45-day window of exclusivity following films’ release from next year.
The streamers strike back
Still, the threat from Amazon and Netflix isn’t going away, says The Wall Street Journal. Amazon is nearing a deal to buy the Hollywood studio MGM Holdings for almost $9bn. If the tie-up goes ahead it “would mark Amazon’s second-largest acquisition in history after its $13.7bn purchase of Whole Foods in 2017”. It would also highlight “the premium that content is commanding” as streaming wars “force consolidation and drive bigger players to bulk up with assets that help them compete”.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Amazon’s shareholders should beware, says Nils Pratley in The Guardian. It’s true that any Amazon takeover of MGM will “probably get a regulatory thumbs up”, as owning the film studio behind the James Bond franchise “does not create a licence to kill when the competition includes beasts the size of Comcast, AT&T and Disney”. However, Amazon now runs an “astonishing” span of businesses, including computing and supermarkets, so there is a very real risk that its “many adventures in unrelated fields” means that it “ties itself into knots” and ends up as a “confused conglomerate”.
The size of Amazon’s $9bn offer for MGM has “astonished” many rival studios, say Brent Lang and Cynthia Littleton in Variety. The problem for Amazon is that while MGM has an “extensive library of over 4,000 film titles”, including classics such as Four Weddings and a Funeral and The Silence of the Lambs, many of the most popular ones have already been heavily “exploited”. Worse, MGM’s deal with Barbara Broccoli and Michael Wilson gives them “final say” over marketing and distribution decisions related to the Bond franchise, complicating any plans to debut Bond films on Amazon Prime or create spin-off series.
-
The year trust became the currency in the art marketOpinion Collectors looking for accountability are turning to smaller dealers, says Sarah Ryan of New Blood Art
-
FCA could lift ban on crypto ETNs for UK retail investorsSome hope that the consultation could lead to a lifting of the ban on crypto ETF sales in the future
-
Who’s driving Tesla?As Elon Musk steps back from government with his eyes on the stars, investors ask if he’s still behind the wheel at his electric-car maker.
-
Investment opportunities in the world of Coca-ColaThere is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
-
Streaming services are the new magic money tree for investors – but for how long?Opinion Streaming services are in full bloom and laden with profits, but beware – winter is coming, warns Matthew Lynn
-
Look to British stocks to lead the charge as the Magnificent Seven falterOpinion Gervais Williams, fund manager, The Diverse Income Trust, picks three British stocks where he'd put his money
-
'Pension funds shouldn't be pushed into private equity sector'Opinion The private-equity party is over, so don't push pension funds into the sector, says Merryn Somerset Webb.
-
Greg Abel: Warren Buffett’s heir takes the throneGreg Abel is considered a safe pair of hands as he takes centre stage at Berkshire Hathaway. But he arrives after one of the hardest acts to follow in investment history, Warren Buffett. Can he thrive?
-
Who will be the next Warren Buffett?Opinion There won’t be another Warren Buffett. Times have changed, and the opportunities are no longer there, says Matthew Lynn.
-
Will Comstock crash – or soar?Opinion The upside for Comstock, a solar panel-recycling and biomass-refining group, dwarfs the downside, says Dominic Frisby.
