The blockbuster launch of "Godzilla vs. Kong" boosted shares in AMC Entertainment Holdings Inc. and Cinemark Holdings Inc. this week as investors grew optimistic that better days are ahead for the theater industry.
"Godzilla vs. Kong" hit the big screen March 31 and racked up $48.5 million in its long holiday debut, or $32.2 million over the three-day weekend. That made it easily the largest box office result since the pandemic shuttered theaters about a year earlier, and it was even in the range of openings for other franchise flicks.
For example, the May 2019 opening of "Godzilla: King of the Monsters" landed $47.8 million over three days, according to BoxOffice.com.
BoxOffice.com had predicted "Godzilla vs. Kong" would sell $41 million in tickets over the long holiday weekend, or $25.5 million over the three-day frame. The film opened concurrently on AT&T Inc.'s HBO Max streaming service.
"Godzilla vs. Kong" is the first big theatrical event since both New York City and Los Angeles have opened their markets and since vaccines have been distributed en masse.
B. Riley Securities analyst Eric Wold on April 5 upgraded AMC to a "buy" rating. He had downgraded the company to "neutral" during the pandemic on debt-load concerns. The company entered the quarantine period with a lopsided balance sheet, and to survive the quarantine, it added even more leverage.
Wold already had a "buy" rating on Cinemark, which has been widely viewed as better positioned to weather the global theater closures and a period of no revenue.
Cinemark shares ended the April 8 trading session up 6.84% from its April 1 close, at $22.97 apiece; AMC shares rose by 4.59% over the same period, closing April 8 at $9.79 each.
In the social media realm, shares in Snapchat parent Snap Inc. surged following an upgrade.
Atlantic Equities analyst James Cordwell this week upgraded Snap shares to "overweight" from "neutral," citing the company's success in transforming its once messaging-centric Snapchat app into an all-encompassing content platform.
Such efforts have encouraged users to spend more time doing monetizable activities on the app, Cordwell said. The analyst is also bullish that Snap's expanding product pipeline could boost revenues in the coming quarters and help the company gain share against competitors.
Snap closed April 8 trading up 15.98% for the week to date, at $63.20 per share.
Microsoft Corp. got a boost after one analyst predicted it will be a top performer during the upcoming earnings season.
Wedbush Securities analyst Daniel Ives believes that Microsoft's Azure cloud business is on track to narrow market leader Amazon.com Inc.'s competitive edge due to its strong momentum in recent quarters. Microsoft is largely considered the No. 2 player in the cloud space, followed by Alphabet Inc.-owned Google LLC.
"Based on our recent field checks for the March quarter, we strongly believe the tide is shifting in the cloud arms race as Microsoft coming off its recent 50% Azure growth number is taking market share vs. [Amazon's AWS cloud computing platform]," Ives wrote in a report.
Microsoft stock closed April 8 up 4.50% from its April 1 close.