It’s been an interesting week across the board for shares in entertainment. With Big Media taking a hit, streamers seeing some upward progress, and a climate of optimism keeping theatrical stocks buoyant, it’s a difficult-to-read climate. Luckily we have Brandon Blake, entertainment attorney from Blake & Wang P.A., to help make sense of the shifts.
Big Media Dull
Wall Street has been mixed regarding larger media groups as the dual-strike actions sent many productions into hibernation. While this has generated plenty of free cash and a temporary lowering in costs for these companies, no one can ignore the overall negative impact of reduced production, either. With the welcome news that the WGA, at least, will be returning to work this week, we would have expected to see a rise in stocks. However, the market remains jittery about other economic aspects, including a weaker advertising market and new checks and balances in the industry. Additionally, worries remain over the degree of disruption the strikes will have on this year’s balance sheets, even if SAG-AFTRA manages to hammer out a deal this week and scripted productions resume this month.
Boost to Theater Chains
Interestingly, however, the climate around the exhibition industry is still reasonably buoyant. AMC Entertainment saw a significant 9% rise in stock price last week, likely fortified by its announced launch of an ad-supported tier for its flagship streamer, AMC+. Cinemark and Marcus saw more modest gains (3.5% and 2.8% respectively), but a gain is a gain at this point. Additionally, Netflix saw a modest 1% gain in the markets, slightly protected from the concerns around profitability other key streamers face as they have long been operating fully in the black.
It’s certainly intriguing to see the market’s different reactions across the entertainment industry this week, even if it is unclear exactly why the potential knock-on effects on the production pipeline have not yet reared their head for exhibitors.
Film and Television 