Is AMC Networks a good buy as analysts issued a hold rating

By:
on Jul 29, 2022
  • AMC Networks has a consensus “hold” rating by analysts.
  • The company is expected to post lower earnings when it reports results on August 5.
  • AMC Networks has little upside potential despite the latest gains.

AMC Networks Inc. (NASDAQ:AMCX) has been subject to analyst ratings this month. Nine research firms covering the stock had a “hold” rating in July. In a different rating, StockNews.com, in a note on Friday, issued the stock with a “hold.” That was a downgrade from the previous “buy” rating. Banking Giant Morgan Stanley has this month downgraded the stock from $40 to $35. Other analysts, including Guggenheim and Goldman Sachs, have cut AMC Networks stock targets.

While AMC Networks has gained by 6.47% this month, the latest price cuts suggest low expectations. Most raters have a price target that is below $35. AMCX currently trades at $30.87, suggesting a low price move.

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The quarter results may not do much either. In the latest quarter, the company’s per-share earnings were $2.54. The earnings were lower than $2.98 the prior year and missed $2.60 estimates. For the next quarter, analysts tracked by Zacks Investment project per-share earnings of $1.98. 

AMC Networks slides after hitting a resistance

Source – TradingView

On the technical outlook, AMC’s upsurge hit a snag after meeting resistance at $33. The stock is sliding, although the short-term moving averages continue to support the price. The stock has set the bottom price at $28, which coincided with oversold conditions.

Concluding thoughts

AMC Networks stock should remain on the watch list of investors. With low expectations, the stock could surprise markets when the quarter results come on August 5. Should the company miss estimates, the stock could face an accelerated sell-off. Investors should consider staying away until the company releases the quarterly results.

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