Cineplex Inc (CGX.TO)

Valuation is pretty elevated. A great company and a great name. It is a classic defensive stock. There are no real block busters this summer. Not much more room to run.

SHORT. It is a short trade. They have done a fantastic job revamping the company and it is a fantastic company but attendance for movie goers is dropping. He fails to see their numbers going a lot higher at Christmas time. People don’t go to see movies in good times, as much as recessions.

Have had a relatively tough quarter in that it is hard to sell popcorn if there are no people in the seats. There weren’t enough blockbusters. This is a very well run company and he wouldn’t be too concerned about it. Feels this is a good, solid, long-term investment.

Had a soft quarter because there were no blockbusters. Off the back of the quarter, Guardians of the Galaxy blew out the August record for a weekend by almost 50%. Has one of his favourite CEO`s and is extracting more dollar per seat every year. Looking at 2015-2016, there are some familiar names coming such as Star Wars, the Avengers, Fast and Furious, etc. Yield of 3.82%.

This is the 1^st time in a while that there has been a decent pullback (10%) because of the lack of blockbusters. Third and 4^th quarters are going to be better. Thinks you will get about a 10% return plus the dividend, giving you a 14%-15% return, with a ton of safety. One of the best management teams out there.

Last year was actually a peak year in terms of the box office tally. Year to date, there have been 2 elements. 1) A few flops at the box office, and 2) a very long and cold winter. What is important is not just a movie house itself, but their forays into digital media. Also, 40% of their revenue is generated from concessions. They also have 50% ownership in an arcade equipment manufacturer. Feels management is very friendly for the shareholder in being able to extract value. Very robust and healthy yield at 3.8%. At 20X PE it is expensive, but historically that is pretty cheap.

This has lagged the market this year. A great long-term investment for income investors. It provides a yield of about 3.7%. 1^st quarter was impacted by weather. Also, they can’t control the slate of movies. Bought a chain of theatres in the Atlantic provinces, which they are refurbishing. Continuing to increase revenue per patron by driving up concession spending. During off times they try to increase traffic through alternative programming. Very good management. Acquired a digital media company, which does advertising for them. Yield of 3.66%.

Has done better than he would have anticipated given threats of new technology and new entrants being able to give you things on your computer. Getting very, very competitive. The way consumers are consuming content is changing dramatically. This company is going to have to continue to deal with that. With the advent of HBO, Netflix, and Amazon Prime, etc. it is going to be very difficult for the theatre business.

Great story. Owned it for quite a while, but Sold way too early. It effectively has a monopoly in this business. Have done some wonderful things such as the Met Opera, their concessions, high-end viewing and the new digital division.

Had a dreadful 1^st quarter because of weather. Also, the slate of movies in the 1^st quarter was too US centric for Canadian viewers. Bought 24 theatres in Atlantic Canada. Have also got additional advertising business and a net flick app that can be used. Average patron is spending $5 on popcorn and drinks. Dividend yield of 3.75%. The pullback is an opportunity for you to get it at a price it was a few months ago.

Attracted to this. Pretty much the dominant monopoly supplier of big picture movies in Canada. Pays a nice dividend of around 6%. He didn’t buy this because of its higher valuation. Stock has run up a lot and he doesn’t see a huge uplift in people going to movies. A bit of a mature segment and is also very cyclical for the kind of movies coming out. Concessions and ads are where their huge profit margins are. Good management. Trades at around 24X estimated earnings and he would prefer it sub 20.

Sold his holdings when he thought valuations got a little high, but it has now pulled back because of a weaker Q1 than people expected. A lot of this is temporary. Q2 has a much stronger film slate coming. Had much lower same-store sales, but were much higher on the concession side. They are still trying to move up on the digital side.

There was a concern for people getting out to see movies in the winter and is heavily dependent on the roster of blockbusters. Have done a very good job on the non-ticket related revenues. This is a name that he is moderately excited on, but not something that would be at the top of his list. If you believe in the consumer and that we have a strong economy and there is a good roster of blockbusters, then it would be a Buy. Expect it will be moderate growth name going forward.

Had some high expenses from some recent acquisitions. Very well managed company. Theatre business is a very stagnant one these days, but this company has been very proactive in adding revenue streams that are not traditional such as hockey games, Opera, more concession revenues, advertising, etc. Trading at a pretty high multiple, but justifiably so. Pullbacks are an opportunity for you to Buy. Decent dividend of 3.6%.

One of the best managed companies in Canada. They add value all over the place. One of their pluses is they managed to get their average concession bill over $5 a customer. Have increasing ad revenue, not just at the theatres, but also on airplanes. Had a weak release schedule in the 1^st quarter and they were hurt by bad weather. Dividend went up and the yield is 3.67%. If they have a strong summer release schedule, earnings will bounce back.