The Cineworld share price rose by more than 4% on Monday as investors cheered the return of the box office. The CINE stock ended the day at 64.12, which was slightly higher than last week’s low of 59.80p. Other similar companies like Cinemark and AMC shares also soared.
Box Office is Back
Cineworld is one of the biggest movie theatre companies in the world. It has hundreds of locations in Europe and in the United States, where it operates its Regal Cinemas brand.
The Cineworld share price did relatively well on Monday after a strong report by AMC. The company announced that it had its best month since the pandemic started. The strong performance was reported in both its national stores in the US and in its international locations. The press release said:
“AMC confirmed today that its October 2021 ticket admission revenues at AMC’s movie theatre circuit in the U.S. also were the highest AMC has seen for any single month since February of 2020.”
Therefore, the CINE stock jumped because of how similar the two companies are. As such, the rising demand for AMC also led to more demand for seats in Cineworld and Regal.
This demand was propelled by some of the biggest movies releases this year. Some of the movies that did well in October were No Time to Die, Venom, Titane, and Last Night in Soho.
Still, in the long term, the company faces key challenges. For one, cinema companies are now competing with companies that produce movies like Disney and HBO. These companies are now offering and encouraging more people to watch the movies in their apps.
Cineworld share price forecast
The daily chart shows that the CINE share price has been under intense pressure lately. It has even declined by more than 48% from its year-to-date high. At the same time, the stock has declined below the 25-day and 50-day moving averages. It is also slightly below the 50% Fibonacci retracement level.
Therefore, despite the jump, there is a likelihood that the shares will drop in the near term. The next key level to watch will be at the key support at 55p. This view will be invalidated if the stock rises to more than 70p.
