Through the difficult pandemic of this past year, many people have turned to movies for entertainment and comfort. Since movies are such an important part of our culture, it makes sense to invest in the world’s largest entertainment companies. We’ve rounded up the top movie stocks to add to your portfolio right now.
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Best Movie Stocks To Buy
Netflix (NASDAQ: NFLX)
Over the past decade, people have transitioned from watching movies in theaters to watching movies at home using streaming services. These services have completely changed the entertainment industry, and Netflix is leading the pack.
Netflix is based in California, but they produce movies and TV around the world. The company started as a DVD mail rental business. In 2007, Netflix introduced the digital streaming element to their subscription, so users could watch content on their computers or on their TVs using a video game console.
In 2013, they started producing their own TV series with “House of Cards”. The initial success of this venture led them to produce more Netflix original movies and TV shows. Netflix now releases hundreds of new titles each year.
Netflix stock has been extremely successful over the past several years. While many other companies struggled during the stock market crash of 2020, Netflix rebounded quickly. It has become clear that this streaming service is here to stay and will likely continue to be a very important part of the entertainment industry.
Analysts have also been very pleased with Netflix’s financial performance this year. They’ve consistently beat estimates and have positive free cash flow. This indicates that this powerhouse stock has plenty of room to keep growing.
Walt Disney Co. (NYSE: DIS)
Disney is has a long history as a powerhouse in the entertainment world. Walt Disney Studios has been making movies since the 1920s, but they’ve since expanded far beyond film.
In addition to Walt Disney Studios, the company owns Marvel Studios, Pixar, 20th Century, and several other notable film studios. They also own several television networks, including ABC, ESPN, Freeform, and National Geographic.
Disney also has a large theme park division. While this sector has struggled due to the shutdowns of the last year, it will likely recover later in 2021 as countries distribute the coronavirus vaccine.
However, Disney’s biggest triumph this year has been their Disney+ streaming service. Customers can watch the full catalogue of Disney, Marvel, and Pixar movies, as well as several other movies and TV shows that have licensing deals with Disney.
This subscription service has been incredibly successful. Since they launched at the end of 2019, they have amassed 94.9 million subscribers. Some industry experts think that Disney+ will match or outpace Netflix in terms of subscribers over the next few years.
Disney stock is trading at an all-time high right now, and they show no signs of slowing down. This is a great stock to add to your portfolio for the long term.
ViacomCBS (NASDAQ: VIAC)
Ths company formed from a merger of CBS and Viacom at the end of 2019. While most of the company’s assets are in television, they do own the Paramount Pictures film studio.
Paramount is one of the oldest film studios in the US and is based in Los Angeles. The company owns Dreamworks and has a stake in Miramax as well.
The company also owns several television stations, including CBS, Showtime, Comedy Central, Nickelodeon, BET, and more. They have their own streaming service, CBS All Access, and they own the Pluto TV streaming service as well.
These streaming services have been essential to ViacomCBS over the last year. At the beginning of March, CBS All Access will become Paramount+. It will include some live TV and exclusive content in addition to everything already on the streaming service.
This stock has been on a consistent growth trajectory this year. If they can continue to stay relevant in the streaming industry, they could be a great long-term investment.
Movie Theater Stocks
AMC Entertainment Holdings Inc. (NYSE: AMC)
Movie theaters have struggled over the past year as a result of global shutdowns, and AMC is no exception. If you were to look at AMC Entertainment financial data over the past year, you’d probably think this was a stock to stay away from. However, fascinating recent events have changed things for this media company.
Towards the end of January, a group of retail investors on Reddit realized that Wall Street hedge funds were shorting stocks that weren’t doing well, like AMC Entertainment and Gamestop. They decided to execute a short squeeze, turning these companies into meme stocks. This sent AMC Entertainment shares up to approximately $20 each.
This was huge, as the stock was previously trading for about $3 per share before. Although the hype quickly died down, shares are still higher now than they were before the short squeeze.
There’s still a lot of attention on AMC as the market grapples with the Reddit phenomenon. Their shares have continued to fluctuate throughout February. This means there’s still some potential here for savvy investors who are willing to take a risk.
Only time will tell if movie theaters can truly recover from the pandemic. Competition from streaming services is high. However, things could change once the majority of the population is vaccinated.
Additionally, AMC is looking at ways to benefit from the high demand for streaming services right now. For example, they recently signed a deal with Universal Pictures to release movies on demand.
IMAX Corp. (NYSE: IMAX)
IMAX completely changed the way we watch movies in theaters. The company was founded in the 1960s with the goal of creating a more immersive entertainment experience for viewers. Their headquarters are in Toronto, but they have outposts in New York and Los Angeles.
There are over 1500 IMAX theaters located around the world. These theaters use large screens, surround sound, and high-quality imagery. Some of these theaters also show 3D movies.
IMAX manufactures the technology that production teams need to create an IMAX movie. They also work with film studios to create and distribute IMAX movies.
This stock has been up and down over the past year. Many theaters had to close at the beginning of the pandemic, and even after they reopened, they haven’t been able to draw people back. This has been an especially big problem for the American market, where COVID-19 is still a huge threat.
However, the Chinese market has been much more amenable to seeing new movie releases in theaters. Over the Chinese New Year weekend, IMAX broke their sales record in China.
As a result, many Wall Street analysts are feeling more bullish on IMAX than other movie theater chains. Because they have a larger international presence, they may return to form faster than AMC and other American theaters.
Movie Studio Stocks
Comcast Corporation (NASDAQ: CMCSA)
Comcast is one of the world’s largest media conglomerates. They have a diverse portfolio that spans the entire entertainment industry, and their stock performed very well this year as a result.
Notably, Comcast owns Universal Pictures, which is one of Hollywood’s most revered movie studios. They were founded in 1912 and are the oldest movie studio in the United States. In addition to producing a huge catalog of iconic films, they also run the Universal Studios theme parks in Los Angeles, Orlando, Singapore, and Osaka, Japan.
Additionally, Comcast provides internet and cable TV services through their Xfinity subscriptions. They also own a huge library of television channels, including NBC, Telemundo, Bravo, Syfy, E! and more.
In 2020, Comcast launched the Peacock streaming service. This streaming service has been growing steadily, although it hasn’t yet reached the success of other services like Netflix, Disney+, or Hulu.
NBC Universal had some major setbacks in 2020. They had to keep their lucrative theme parks closed, and many blockbuster movie releases were pushed back. Their earnings suffered as a result, but their stock price hasn’t.
Right now, Comcast stock is trading at an all-time high. The company also raised their dividend at the end of 2020, and now pay a dividend of 1.89 percent. Investors seem confident that this company will return to its prior success.
Lions Gate Entertainment (NYSE: LGF.A)
Lionsgate is an entertainment company based in Santa Monica, California. They are a relatively new movie studio, as they were originally founded in 1997 in Canada.
Lionsgate Films is the company’s most successful division. Over the years, they produced several successful movie series, including Twilight, The Hunger Games, and Saw. The movie studio has several smaller subsidiaries, most notably Summit Entertainment.
Lionsgate also has a television division and a smaller video game division. They also own Starz, the popular cable TV channel. Starz has become increasingly popular over the last several years, as consumers have been willing to spend more money on premium cable subscriptions.
Shares of Lionsgate had been consistently dropping through 2018 and 2019, and stayed stagnant through most of 2020. However, the stock seems to be on a rebound, as returns have been consistently improving since November.
While the company lost money in the last quarter of 2020, their Starz subscriptions were up. Many analysts consider this a more important indication of long-term growth.
Lionsgate also has a solid 2.46 percent dividend yield. Since they seem to be on a slow but steady rise, now could be a good time to add this investment to your portfolio.
Dolby Laboratories (NYSE: DLB)
Dolby Laboratories creates audio compression technologies for entertainment. Movie theaters around the world use their surround sound technology. They also make audio technology for personal electronics.
Because there are so many different types of electronics that rely on Dolby’s technology, they have been able to stay relevant this year despite the market crash.
Their fourth quarter earnings report was particularly exciting. The company beat their revenue and EPS estimates, and their stock price went up as a result.
There’s still plenty of room for Dolby to grow as the pandemic comes to a close. When movie theaters can fully reopen, it’s likely that their sales will go up.
Movie Penny Stocks
Eros STX Global Corp. (NYSE: ESGC)
Eros STX is an entertainment company based in Burbank, California. Their movie studio worked on several notable film projects over the last few years, including Hustlers, Molly’s Game, The Gentlemen, and more.
The company also distributes a wide variety of films internationally. They also operate TV and web series divisions.
Eros stock has been very volatile over the last year. Right now, they’re trading for only $2 per share.
Investors should always be careful when buying penny stocks, as they can be much more volatile than the average investment. However, Eros could be a great way for investors to get a taste of the entertainment industry without spending a lot of money.
Should I Invest In Movie Stocks?
The entertainment industry has been on a roller coaster over the past several months. While movie theaters have been closed in many places, streaming services are doing better than ever. Consumers have been turning to the internet to watch the year’s hottest movies and TV shows.
Movies and other visual media have become an extremely important part of our culture. This means that the biggest companies in the movie industry aren’t going anywhere anytime soon.
Companies that make and distributes movies are a great long-term addition to your portfolio. In particular, you should keep your eye out for companies that are involved in streaming services.
Best Movie Stocks: Final Thoughts
The movie industry may be evolving, but it isn’t going anywhere anytime soon. Now is a great time to add these movie stocks to your portfolio for long-term growth.