Investment Thesis
Cineplex (CPXGF) (TSX:CGX) delivered solid Q2 2018 earnings with double-digit revenue growth. The company reversed its box-office revenue decline in Q1 2018 with double-digit revenue growth. The company also has diversification initiatives to grow its revenue outside of box office revenue. These include location-based entertainments (The Rec Room, Topgolf, and Playdium) and digital media services. These initiatives should be able to provide a long runway of growth. The company is currently trading at an attractive valuation and offers a 5.3%-yielding dividend.
Source: YCharts
Volatility in Box office revenues
Cineplex