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NYU’s ‘dean of valuation’: AMC won’t be able to justify lofty stock price using old business model

Street performers in Minnie Mouse costumes pass in front of an AMC movie theater at night in the Times Square neighborhood of New York, Oct. 15, 2020.

Amir Hamja | Bloomberg | Getty Images

AMC Entertainment must adapt to the shifting entertainment landscape if the company wants to survive and maintain its current market valuation, New York University’s Aswath Damodaran told CNBC on Thursday.

The theater chain’s traditional strategy won’t cut it in the emerging movie business, the finance professor said, but top brass is making strides to meet the moment.

“I think that at the moment there’s clearly no way you can get to a $33 billion market cap with the old business model that AMC had,” he said on “Tech Check.” “But from my perspective at least they’re doing the right thing in raising capital and getting themselves ready for the transition that’s ahead.”

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