AMC Networks Inc. (NASDAQ:AMCX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year’s statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that AMC Networks will make substantially more sales than they’d previously expected. Investors have been pretty optimistic on AMC Networks too, with the stock up 10% to US$26.36 over the past week. We’ll be curious to see if these new estimates convince the market to lift the stock price higher still.
Following the upgrade, the latest consensus from AMC Networks’ 13 analysts is for revenues of US$3.1b in 2021, which would reflect a notable 11% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing US$2.9b of revenue in 2021. It looks like there’s been a clear increase in optimism around AMC Networks, given the decent improvement in revenue forecasts.
NasdaqGS:AMCX Earnings and Revenue Growth November 15th 2020
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It’s clear from the latest estimates that AMC Networks’ rate of growth is expected to accelerate meaningfully, with the forecast 11% revenue growth noticeably faster than its historical growth of 3.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.8% next year. Factoring in the forecast acceleration in revenue, it’s pretty clear that AMC Networks is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for next year. They’re also forecasting more rapid revenue growth than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at AMC Networks.
Of course, there’s always more to the story. At least one of AMC Networks’ 13 analysts has provided estimates out to 2024, which can be seen for free on our platform here.
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