Cineplex Inc (CGX.TO) Buy, Sell or Hold

Cineplex Inc (CGX.TO)

11.74

-0.08 (0.68%)

as of Jun 19, 2026, 8:00:01 pm Market Open.

297 watching

COMMENT

Has had the benefit of Hollywood providing it with some very excellent product in the last year or two. 100% dependent on Hollywood.

TOP PICK

Has had a bit of a run up in the last few days so wouldn't chase it. Very low payout ratio. Entertainment seems to do fairly well in recessions.

WEAK BUY

Box office revenues have been quite robust and near term outlook is quite good. 3-D movies are high margin. They make their money on concessions. They are a virtual monopoly and are priced that way. Downside is that they have no control over their product. Whatever Hollywood sends them they have to show.

BUY ON WEAKNESS

Very solid base. Box office has been very strong. Shifting towards digital and 3-D technology. Concessions have been strong. Media business is a great source of directed advertising. About $600 million in tax pools so well positioned for conversion. A little expensive.

TOP PICK

Makes money Movie tickets, refreshments and advertising. Looking for them to do very well on 3-D movies. Own a lot of real estate and will be sheltered from tax for 3 or 4 years when they convert to a corporation. About 60% payout. 7.6% distribution.

BUY

Their results have been good and he is looking at this. Low payout ratio. Distribution looks fairly safe.

BUY ON WEAKNESS

His favourite trust. Just reported a really good quarter. Firing on all cylinders. Distribution is consistent and stable and they've committed to paying this once they've converted to a corp. Excellent balance sheet. Try to buy in the $16 range.

BUY

Have lots of losses to allow them to continue to pay out after conversion. Oligopoly in Canada in this business. It’s a growing business. The concession business has done well for them. Nice yield, well run.

TOP PICK

With 130 theatres they are the largest operator in Canada. Recession resistant. Good management. Looking for alternative sources of revenue such as 3-D movies. 7.5% yield is very safe and at a low payout ratio.

TOP PICK

Movie concessions have 80% gross margins. 3D has some real potential for movie theatres. When it converts to a corporation in 2011, it has a tremendous amount of tax shelters because of all the real estate it owns. Distributing about half its cash flow so they have a big margin to raise their distribution. 8% distribution.

TOP PICK

Good balance sheet. 60% payout ratio. Have tax losses for 3 or 4 years beyond 2011. Great management and cash flow. Growing EBITDA. Deploying new technology giving them a greater market share. 7.8% yield.

BUY

Have had good earnings this year because the box office has been really strong. Also benefiting from strong concession revenues.

TOP PICK

Great management team. Benefited from a great slate of movies in the first half of 2009 with another strong slate coming in the 2nd half. People are returning to movies versus going on luxury vacations, buying new cars, etc. 7.6% yield should be safe.

TOP PICK

Very good balance sheet. Payout ratio is 58%. Almost a quasi-monopoly in the theatre space. Recession resistant. Margins on concessions and loyalty programs are helping the bottom line.

COMMENT

Well run company. Just did a financing. He thinks the dividend is safe. The only problem he has with the industry is that they can't control the end product, the movies. Will do really well if a bunch of blockbusters comes along but if Hollywood produces a bunch of stinkers they won't do well.

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