If I Can't Talk You Into Buying AMC This Summer, How About Cinemark, IMAX, or EPR?

You might not realize it, but your local multiplex is having its best year since 2019. Domestic movie theaters have collected $3.7 billion in ticket sales so far this year, 10% ahead of where box office receipts were a year ago at this time, and 40% ahead of where things stood two years ago. This is the strongest five-month start for the industry in any year since the COVID-19 crisis.

Is it time to buy AMC Entertainment (NYSE: AMC)? Despite stateside admissions at a seven-year high, AMC stock has been cut nearly in half over the past year. Over the past five years, AMC shares have plummeted -- brace for this -- more than 99% on a split-adjusted basis.

Image source: Getty Images.

There are some good reasons for the stock's brutal underperformance, but could this finally be a good time to consider AMC stock a viable investment? If you're still unconvinced, maybe you'll consider some of the less volatile ways to play the cinematic recovery in fellow exhibitor Cinemark (NYSE: CNK), experience supersizer IMAX (NYSE: IMAX), or multiplex landlord EPR Properties (NYSE: EPR). Let's take a closer look at why AMC still has a lot to prove, and why some of these smaller players could be timely opportunities.

1. Cinemark

Cinemark is smaller than AMC, but it's already years ahead on key profitability milestones. AMC is still posting annual losses, and isn't expected to turn that corner until 2029 at the earliest. Cinemark has been profitable since 2023. There is no positive earnings multiple for AMC, naturally. Cinemark is trading for less than 14 times forward earnings. Cinemark has even been paying a quarterly dividend since early last year.

It's not just the head-scratching losses that have kept AMC in check. AMC is one of the worst-performing stocks over the last five years because it has diluted its shareholders by printing new shares faster than its popcorn maker spits out fluffy golden treats. AMC's fully diluted, split-adjusted share count has soared 42-fold since 2019. That is not a typo. Cinemark's share count over that time has risen modestly by 14%.

The revenue growth fundamentals are encouraging for both companies. You know ticket sales are rising, but both chains have beefed up their concession stand offerings with pricier options and release-themed collectibles. Analysts see the two companies growing their top lines by 11% to 12% this year, and that could prove conservative if moviegoing trends continue heading in a bullish direction.

2. IMAX

You have probably taken in an IMAX experience with enhanced visuals and sound on a gargantuan projector screen. Some directors of obvious blockbusters even shoot scenes with cameras designed to take advantage of IMAX's enhancements.

The bad news about what's driving the recent surge in ticket sales is that it's not the typical IMAX releases pulling in audiences. This past weekend, the two biggest draws were Backrooms and Obsession. Backrooms topped $80 million in domestic admissions, despite being made by a 20-year-old YouTuber with a $10 million budget. Obsession is the first nationwide theatrical release since E.T. -- 44 years ago -- to see its weekend grosses increase in both the second and third weeks.

Having a pair of micro-budget releases lighting up the multiplex in recent weeks isn't ideal for IMAX, but it will still fare well. The three top-grossing films so far this year have all been given the IMAX treatment. The same can be said about the slate of even bigger releases coming out later this year. AMC, Cinemark, and IMAX will be just fine.

IMAX is trading for 23 times this year's projected earnings. Cinemark is understandably cheaper, but IMAX has consistently posted double-digit percentage earnings beats over the past year.

3. EPR Properties

My final theatrical investing recommendation isn't an actual exhibitor or experience enhancer. EPR just happens to be the landlord for many theaters across the country. EPR is a real estate investment trust (REIT) specializing in experiential properties. It owns amusement parks, "eat and play" venues, and, yes, several AMC multiplexes.

Is EPR at risk if AMC defaults on the theaters that it owns? Of course, but it has a diversified portfolio. EPR's biggest risk is if consumer non-discretionary spending takes a dive in an economic slowdown. Along the way, EPR investors are collecting a juicy 6.4% yield. At the very least, that's collectible popcorn bucket spending money.

Rick Munarriz has positions in EPR Properties. The Motley Fool has positions in and recommends EPR Properties. The Motley Fool has a disclosure policy.