UPDATE: B. Riley Upgrades AMC Entertainment (AMC) to Buy

(Updated - June 16, 2016 8:35 AM EDT)

B. Riley upgraded AMC Entertainment (NYSE: AMC) from Neutral to Buy with a price target of $34.75, implying upside of 29%. Analyst Eric Wold sees an attractive entry point.

"Given our continued belief the acquisition of Carmike (CKEC; Neutral; $30.00 PT) should better position AMC for improved EBITDA growth during a stronger 2017/2018 box office cycle, we believe the 7% pullback in shares along with a 13% cut to the Q2 consensus EPS estimate since our 3/30 downgrade provides an opportunistic entry point ahead of the 6/30 shareholder vote," said Wold.

"We acknowledge the shareholder vote remains a binary event and one that is likely to be close. However, while we believe a pre-vote increase to the $30.00/share acquisition offer is unlikely, our analysis shows the opportunity for AMC to meaningfully raise its offer, if necessary, while still driving solid accretion from the combination. With all that in mind, we now believe the company’s risk/reward profile has shifted to the positive and believe the potential combination of positive box office optics this coming weekend along with a favorable shareholder vote in two weeks could create a situation where this more attractive entry point is not seen again. Therefore, we are proactively upgrading AMC from Neutral to Buy with an unchanged price target of $34.75, which provides potential upside of 29% from current levels (along with a 3.0% dividend yield)," added the analyst.

For an analyst ratings summary and ratings history on AMC Entertainment click here. For more ratings news on AMC Entertainment click here.

Shares of AMC Entertainment closed at $26.86 yesterday.

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