IMAX is considering a sale, sparking speculation about buyers. Shares rose 15% Friday after the Wall Street Journal reported IMAX approached entertainment companies. The process is early and may not end in a deal. Here are the analysts’ top buyer picks and what each could gain with IMAX.
Netflix is attracting the most attention as a possible buyer. An analyst from Seaport called Netflix a logical fit, noting the company’s preference for exclusive, event-focused releases. Netflix already has two films set for IMAX-only runs before they stream, including a Brad Pitt movie and a Narnia film. If Netflix owned IMAX, it could more easily expand this release strategy, enhance its exclusive offerings, and have direct control over a leading premium cinema brand. Earlier this year, Netflix dropped out of the bidding for Warner Bros. Discovery, so it may be open to other deals.
The same analyst also mentioned Amazon and Apple as possible buyers, since both companies are growing their content businesses and already have partnerships with IMAX. Either company could use IMAX’s technology and brand to offer more immersive viewing options and strengthen its competitive position in premium content distribution.
Benchmark’s analyst gave special attention to Sphere Entertainment, raising his IMAX price target from $44 to $60 on Friday. He said Sphere is an especially interesting option because it focuses on immersive, high-end experiences. Acquiring IMAX’s worldwide network and connections with filmmakers could help Sphere grow beyond its Las Vegas location.
Walt Disney was also mentioned as a possible buyer, but the situation is complex. Last month, Disney launched Infinity Vision, which competes directly with IMAX in the premium large-format theater market. If Disney acquired IMAX, it could consolidate its position in this space, though IMAX’s chief financial officer called Infinity Vision a marketing move to make up for Disney not having an IMAX platform for its Avengers release. After that announcement, IMAX shares dropped 5.4% before rising again on Friday.
Overall, 12 analysts surveyed by FactSet recommend buying IMAX, and 1 suggests holding. This strong agreement shows confidence in IMAX’s upcoming films, growing profit margins, and the strength of the premium cinema market, whether or not a sale happens.
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