5.98%

14.8

Philip Anschutz

Long-Term Buy - Price 21.95 on Oct. 30
by Hilliard Lyons
3Q results reflected strong industry fundamentals and good company execution. Total revenue rose 11.4% versus year-ago period, on higher attendance, ticket prices, and greater concession business...Industry data show summer '07 box-office tally of $4.18 billion as largest [ever]...total operating expenses rose just 1%, including effects of minimum-wage hikes and inflationary pressures...the shares [are] attractive, based on several valuation measures, including cash flow. A 5.4% dividend yield and moderate but steady earnings growth could provide investors with annual total return of roughly 14%.

consumer play

Downgraded by Banc of America from Buy to Neutral

Leading movie theatre owner offers current yield over 5% as box office produces second consecutive year of strong growth. 3-D and in theatre advertising provide incremntal upside.

Upgraded by Soleil from Hold to Buy

dividend

"National CineMedia (NCMI) is an intriguing recent IPO, a leader in selling on-screen digital advertising that runs before movies begin...

Perhaps a less chancy way to play NCM is through Regal Entertainment (RGC), the biggest theater operator, which owns 22.6% of NCM. That stake is valued at $590 million, or 18% of Regal's $3.24 billion market value. Controlled by Phillip Anschutz, Regal has been active in distributing capital back to shareholders as special dividends.

Regal will soon get company in the public markets with the planned IPOs of theater chains Cinemark and AMC, which could direct attention to stable film-audience trends."