Hollywood writers' strike deal lifts movie theater and streaming stocks
By James Rogers
'The world's movie theatres can celebrate,' tweeted AMC's CEO
Shares of cinema and streaming companies rose Monday, after the Writers Guild of America announced a tentative agreement to end the Hollywood writers' strike.
On Sunday the Writers Guild of America said that it had reached an agreement in principle on all deal points related to a new 2023 Minimum Basic Agreement, or MBA, subject to the drafting of final contract language.
Shares of movie-theater chain and meme-stock darling AMC Entertainment Holdings Inc. (AMC) rose 0.5% in premarket trades, while rival Cinemark Holdings Inc. (CNK) rose 2%.
Related: Tentative deal reached to end Hollywood writers strike, union says
AMC's CEO, Adam Aron, described the deal as a cause for celebration. "An announced deal ends the 5-month long Writers' strike, pending an affirmative union member vote," he tweeted Sunday. "Directors and Writers contracts now behind us. Only the Screen Actors Guild left to go. The world's movie theatres can celebrate."
"Extremely good news that progress is being made," Aron added.
Analysts have highlighted the possible impact of the Hollywood writers' strikes on AMC, with B. Riley Securities analyst Eric Wold warning that the strikes could potentially put the 2024 film slate at risk.
Related: AMC equity offering is a 'safety net' and a chance to reduce debt balances, analyst says
Streaming stocks also rose in premarket trades Monday, boosted by the tentative agreement to end the writers strike. Walt Disney Co. shares (DIS) rose 0.5%, while Warner Bros. Discovery Inc.'s stock (WBD) gained 2.1% and Paramount Global Inc. shares (PARA) rose 2%. Netflix Inc.'s stock (NFLX) was up 0.7% premarket, and Endeavour Group Holdings Inc. shares (EDR) gained 0.3%.
-James Rogers
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09-25-23 0914ET
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