Super Bowl LIX is almost here. On Sunday night at the iconic Caesars Superdome in New Orleans, the Philadelphia Eagles and the Kansas City Chiefs will clash in the 59th rendition of America’s most popular sports event. But two other giants from these two great cities are already clashing on Wall St: Comcast (CMCSA) and AMC Entertainment (AMC).
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Led by quarterback Patrick Mahomes, the Chiefs represent a dynasty in the making, the juggernaut that no one enjoys matching up against. On the opposing side, the Philadelphia Eagles provide more than enough competence through Jalen Hurts. However, they haven’t quite reached the same level of sustained brilliance.
Sports commentators unanimously agree that the Chiefs are the favorites and wield a grander footprint in the NFL than the Eagles. However, the roles are reversed when we turn the page to Wall Street as a giant headquartered in Philly (Comcast) stands tall over a rambunctious up-and-comer headquartered in Kansas (AMC).
Comcast Headquarters
For Wall St. analysts focusing on the entertainment sector, the Philadelphia-based Comcast owns practically all the bragging rights. With a market capitalization north of $130 billion, Comcast is a bona-fide media powerhouse. The company’s massive footprint encompasses media channels, broadband communications, and theme parks.
AMC movie theater.
On the other hand, Kansas City-based AMC Entertainment plays the role of a scrappy underdog who’s already won some titles. AMC has become a movie theater dominator, stomping in with the largest foot span in the U.S. and the world, with approximately 900 theatres and 10,000 screens worldwide. It’s ironic because AMC stock is trading like how the Chiefs played back several years before the Mahomes era, as in very poorly. Now, shares trade hands for around three bucks, with a market cap of around $1.3 billion.
Still, there’s a reason why you play the game — anything can happen. Here’s the other big matchup breakdown ahead of the enticing Super Bowl showdown set to take place on Sunday night in the U.S.
Comcast: Three Yards and a Cloud of Dust
Regarding football traditions, few statements capture the glory days like this: three yards and a cloud of dust. For a quick rundown for anyone unfamiliar with the sport, each team has four attempts or downs to reach 10 yards before they turn control of the ball to the opposing team.
A team can quickly eat up the game clock by running for three yards at a time. In addition, one yard isn’t a big risk for a fourth-down conversion (especially if you’re consistently pushing the opposing defense by multiple yards). It’s boring and unimaginative, yet feeding the running back from the I-formation with the ball can yield significant long-term rewards (as in winning games and, ultimately, championships).
That’s essentially the Comcast story. By no means does it offer an exciting narrative. However, there’s beauty in its predictability, much like a running back just driving his legs for a few yards. Those yards can mean the difference between winning and losing. In the case of Comcast, it broke the plane for a big fourth-quarter earnings beat.
Adjusted for non-recurring items, the media giant posted earnings per share of 96 cents, beating the consensus view of 86 cents. On the top line, revenue rose 2% to $31.92 billion, exceeding analysts’ target of $31.64 billion.
Graph showing Comcast (CMCSA) valuation metrics.
However, the predictability of Philadelphia’s Comcast also makes it one-dimensional. It will probably get those three yards, but that’s about the best to be hoped for. In fact, analysts are calling for FY2025 sales to land at $122.6 billion, which would be almost 1% down from last year’s tally of $123.7 billion.
So, why bother with CMCSA stock? It’s reliable, predictable, and offers a dividend yield of 3.74%. Plus, with a price-to-sales ratio of only 1.05 times trailing-year revenue, Comcast could be an attractive deal.
Is Comcast Stock a Buy, Hold, or Sell?
Turning to Wall Street, CMCSA stock carries a Moderate Buy consensus rating based on 11 Buy, 11 Hold, and zero Sell ratings. The average CMCSA price target is $43.08 per share, implying a 28.41% upside potential.
Based on 22 Wall Street analysts offering 12 month price targets for Comcast in the last 3 months. The average price target is $43.08 with a high forecast of $58.00 and a low forecast of $35.00. The average price target represents a 24.98% change from the last price of $34.47.
AMC Entertainment: The Immaculate Investment?
In football lore, the “Immaculate Reception” is one of the most miraculous, game-changing plays of all time — a bizarre deflection turned what was indeed a Steelers loss into an iconic victory. In the investing world, AMC Entertainment offers some parallels.
Back during the worst of the COVID-19 pandemic, AMC was left for dead. Frankly, it would not have surprised anyone to see the enterprise crumble. At the time, no one was going to movie theaters due to the severe public health risks. However, the worst possible event — a raging global pandemic — turned AMC into an iconic meme stock, thus representing a symbol of market defiance.
Still, you shouldn’t get too ahead of yourself. AMC is very much what most people would regard as a penny stock. Moreover, it’s a poorly performing one, with shares down almost 21% year-to-date. Backed up into their endzone, circumstances don’t seem particularly auspicious for the Cineplex operator.
Chart showing AMC Entertainment (AMC) valuation metrics
It’s all in the numbers. For FY2024, analysts are projecting sales of only $4.6 billion, implying a loss of around 4% against the prior year’s result. For FY2025, sales could rise to $5.1 billion, up modestly from 2023’s haul of $4.8 billion. On paper, the security is super-cheap, trading at 0.22x trailing-year revenue. Despite this valuation, it suffers from significant bouts of volatility.
Nevertheless, AMC stock attracts attention because it’s Wall Street’s version of the razzle-dazzle or the trick play. For example, a flea flicker can be good for a dramatic score if the offense catches the opposing secondary snoozing. An excellent parallel is the high short interest against AMC.
Currently, 11.41% of the equity’s float is held short. If AMC stock suddenly rises, overexposed short traders may be forced to cover their positions. Covering a short involves buying the target security, which could create an upward panic.
However, if the defense is disciplined, a flea flicker might send the quarterback to the hospital. It’s a stock to be traded sparingly, if at all.
Is AMC a Good Stock to Buy?
Turning to Wall Street, AMC stock has a Hold consensus rating based on zero Buy, four Hold, and zero Sell ratings. The average AMC price target is $3.63 per share, implying a 17.10% upside potential.
Based on 4 Wall Street analysts offering 12 month price targets for AMC Entertainment in the last 3 months. The average price target is $3.63 with a high forecast of $4.00 and a low forecast of $3.25. The average price target represents a 17.10% change from the last price of $3.10.
AMC for the Thrill, Comcast for the Win
Sometimes, you need a quick score — and AMC stock offers the mobility necessary to get into position. Unfortunately, the issue with the Cineplex operator is that it’s not consistently reliable. The razzle-dazzle might work for one play, but it cannot be the staple of a title-winning team.
In contrast, what Comcast lacks in pizzazz, it more than makes up for with its consistency. While you’re not going to see CMCSA beat the free safety for a 70-yard touchdown reception, it will be bulldozing defensive linemen for a few yards here or there. Those yards throughout the season can lead to a championship, maybe even a dynasty.
