Cineplex Inc Case Study

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Business Environment
INTRODUCTION
Cineplex Inc. is a Canadian Film Exhibitor company that operates only in Canada for the time being. It operates in the Entertainment industry, and pretty much has a monopoly over the movie theatre and film exhibition sector in most parts of Canada. However, the current data in Canada suggests that Video-On-Demand (VOD) popularity is experiencing a rather rapid increase, followed by an increase in sector’s development and revenue all around. Nowadays, all of the major Canadian broadcasting companies -- such as Rogers -- offer some sort of VOD service to their customers.2 Therefore, the net attendance of movie theatres, Cineplex Inc. in particular, inevitably go through a yearly drop. On the other hand, the industry is constantly growing and attempting to overcome its obstacles by introducing new features and services. Therefore, the profitability of the industry is constantly sustained.
INCOME AND RIVALRY
Despite the interference that VOD has created, Cineplex’s products and services are on another level compared to the broadcasting companies. Furthermore, the main income of the company comes from the services and the concession stands. Even though watching high quality movies and series is made possible because of VOD, the …show more content…

Plus, the company increases the dividends annually. So, investing in Cineplex Inc. sounds like a good investment using the “Buy and Hold” strategy. By analyzing the trend-lines and the charts, it could be expected for the stock to break through the resistance line fairly soon towards the middle of this quarter as well. Furthermore, considering the fact that this stock has a relatively low P/E ratio of 28.71, pays dividends, is a strong and recognizable brand, and has strong balance sheets and cash flows, it would be a really good choice for a value

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