IMAX Corporation (IMAX): what the price assumes

Generated: 2026-07-29 · Exported: 2026-08-01 · Source: https://boothcheck.com/report/IMAX

Headline

Field	Value
Ticker	IMAX
Company	IMAX Corporation
Current price	$47.36/sh
Composition	Content Solutions 38% / Technology Products and Services 62%

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

Field	Value
Inversion basis	whole-company
Operating margin (value-band context)	10.2%
Operating margin today	19.1%
Margin compression (value-band)	-8.9pp
Must persist for	6.7y
Multiple paid	35x operating income

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 9% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.9 years.

How unusual the bet is: elevated

Reference	Value
vs own history	+0.26σ
cohort percentile (of 190 peers)	62
sustained it ~6.7 years at this level	23%
implied end-window share	0%

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Family	Median price/FV	Models	Reads
Asset	5.98x	4	expensive
Earnings	3.16x	5	expensive
Relative	2.05x	5	expensive
Growth	0.74x	3	justifies

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.4%); the inversion above states its own rate.

Per-Model Detail (n=17)

Model	Family	FV	Price/FV	Applicable	Methodology
DCF Perpetual Growth	Growth	$66.76	0.71x	yes	FCF base $0.1B, growth 12% (input: historical growth), terminal g 4.0%, WACC 8.4%, 6yr projection
DCF Exit Multiple	Growth	$63.65	0.74x	yes	Exit EV/EBITDA: 33.3x / 35.3x / 37.3x (bear / base = today's held flat / bull), 6yr
Relative Valuation	Relative	$24.86	1.91x	yes	P/E 33.79x (blended: static sector reference 18x + trailing (TTM) 71x), scenarios: 28.0x / 33.8x / 39.5x (bear / base = reference held flat / bull), EV/EBITDA 18.98x
Simple DDM	Growth	—	—	no	—
Two-Stage DDM	Growth	—	—	no	—
Simple Excess Return	Asset	$7.25	6.53x	yes	BV/sh $6.12, ROE (TTM) 11.0%, ke 9.3%
Two-Stage Excess Return	Asset	$7.86	6.03x	yes	5yr excess ROE then converge to ke=9.3%
Discounted Future Market Cap	Growth	$47.41	1.00x	yes	Rev $0.4B, growth 12% (input: historical growth; tapered), Terminal P/S: 5.3x / 6.4x / 7.5x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair Value	Relative	$23.10	2.05x	yes	EPS $0.66, growth 35% (input: historical EPS growth), PEG=2.02 (Overvalued)
Margin Trajectory	Growth	—	—	no	—
Earnings Power Value	Earnings	$4.58	10.34x	yes	Normalized EBIT (5y avg op income, one-time charges added back) $0.04B × (1−29%) / WACC 8.4% → EPV (no growth)
Residual Income	Asset	$7.98	5.93x	yes	BV $6.12 + 5yr PV of (ROE (TTM) 11.0% − Kₑ 9.3%) × BV; BV grows 7.1%/yr
Graham Number	Asset	$9.53	4.97x	yes	√(22.5 × EPS $0.66 × BVPS $6.12) — Graham's conservative floor
EV/EBITDA Relative	Relative	$14.52	3.26x	yes	EBITDA $0.08B × sector EV/EBITDA 12.0x
FCF Yield	Earnings	$20.34	2.33x	yes	FCF $115.5M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF Yield	Earnings	$14.99	3.16x	yes	SBC-adj FCF $0.09B (FCF $0.12B − SBC $0.03B) capitalized at Kₑ
Ben Graham Formula	Earnings	$21.30	2.22x	yes	EPS $0.66 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/B	Asset	$1.11	42.67x	yes	BV $6.12 × (ROIC 1.5% / WACC 8.4%) (excluded from median)
P/Sales Sector	Relative	$18.45	2.57x	yes	Revenue $0.40B × sector P/S 2.5x
PEG Fair Value	Relative	$24.75	1.91x	yes	EPS $0.66 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings Yield	Earnings	$7.14	6.63x	yes	EPS $0.66 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations Multiple	Relative	—	—	no	—
Clinical Phase NPV	Growth	—	—	no	—
Merton	Asset	—	—	no	—
V5 Mechanical	—	—	—	no	—

Solvency

Field	Value
Net debt	$98.1m
Net debt / NOPAT (after-tax)	1.77x
Net debt / operating income (pre-tax)	1.27x
Interest coverage	10.4x
Share count CAGR (buyback)	-0.9%
Burning cash	no

Bullet Takeaways

• IMAX licenses its premium large-format projection systems and image technology to cinemas worldwide and takes a cut of the box office, operating a network of 1,864 systems across 91 countries rather than owning theaters.
• The risk is the price extrapolating a record year: at about 36 times operating income the market is paying for growth at the company's self-funding ceiling to hold for roughly seven years, while box office is inherently hit-driven and lumpy.
• Watch the film slate and installation pace; IMAX guides 2026 to about $1.4 billion in global box office and 160 to 175 system installs, and both depend on a strong Hollywood and local-language lineup landing.

Bull Case

The direction of every number that matters is up, and the momentum is the bull case. IMAX closed 2025 with a record $1.28 billion global box office, up 40% from the prior year and 13% above its pre-pandemic 2019 record, with all three regions setting marks: North America $449 million, China $407 million, and rest of world $427 million. Operating margin runs near 19% and the company throws off real cash, so this is not a recovering business limping back; it is one printing the best results in its history. When revenue, margins, and cash flow are all moving in the same direction off a record base, the burden shifts to the bears to explain why the trend reverses.

The network is what makes that box office recurring rather than one-time. IMAX does not own theaters; it places its systems with cinema operators and earns a share of every ticket sold on those screens. Its filing describes the structure: systems are provided "to customers through joint revenue sharing arrangements", so a single installed system generates a stream of box-office-linked revenue for years. The footprint keeps expanding: 1,864 systems in 91 countries at the end of 2025, with 160 installed during the year, up 10% from 2024, and a backlog of 434 systems still to come. Each new system is a new annuity on the box office, and the backlog is visibility on growth the company has already signed.

The most underappreciated driver is local-language content. IMAX's 2025 local-language box office reached $405 million, 66% above the prior record, on the largest slate in its history, 67 international films from 14 countries. This matters because it loosens IMAX's historical dependence on the Hollywood release calendar: a strong year in Japanese, Chinese, or Indian cinema can now fill the screens when the studio slate is thin. Management guides the local-language slate to 75 titles in 2026 and total box office to about $1.4 billion, another record. The bull case is a capital-light network operator with expanding screens, a diversifying content engine, and momentum at an all-time high.

Bear Case

The fragile assumption baked into the price is that a record year is a new baseline rather than a peak. At about $44 (June 27, 2026) the market values IMAX at roughly 36 times operating income, embedding growth at the company's self-funding ceiling for about seven years. That assumption rests on 2025's $1.28 billion box office, up 40% in a single year, being extended and built upon. But box office is hit-driven. A blockbuster-heavy slate produces a year like 2025; a thin or poorly received slate produces a weak one, and IMAX does not control which films get made or whether they connect with audiences. The company's own accounting reflects how much rests on the films: it estimates variable consideration using "average historical box office results, eliminating significant outliers", an acknowledgment that the revenue swings with the slate. The price assumes the swings keep breaking favorably for the better part of a decade, which only about one in five comparable fast-growers has managed.

The second dependency is the studios and the theatrical window itself. IMAX's screens are filled by films from Hollywood and increasingly from international producers, but the structural pressure on the theatrical model has not gone away: streaming has compressed windows and changed how studios think about which films deserve a wide cinema release. A year where the major studios pull back on the kind of spectacle that drives premium-format demand would hit IMAX directly, because its differentiated experience matters most for exactly the big-budget films that are most exposed to a streaming-first strategy. The local-language expansion diversifies this, but it does not eliminate it; the largest box-office dollars still come from the tentpole releases.

The valuation gives those risks no cushion. Every static method lands below the price: asset-based approaches put fair value far below, earnings-power and peer-multiple methods sit well under it, and only the growth-driven cash-flow method, the one that carries the record year forward, reaches the current level. When a single growth-dependent family is the only one that justifies the price, the price is a pure durability bet. The balance sheet is fine, net debt is about $98 million against operating income, with interest covered more than ten times, so this is not a solvency concern. The bear case is narrower and harder to dismiss: IMAX is a good business priced as if its best year ever is the floor, when the history of the box office says strong years and weak years alternate, and a single soft slate would collapse the multiple toward where the other methods sit.

Valuation

The price is paying for the record to continue. At about $44 IMAX trades near 36 times operating income, and inverting that says the market expects operating growth held at the company's self-funding ceiling for roughly seven years. The near-term rate is within what IMAX has just delivered, so the question is duration rather than peak pace, and only about one in five comparable fast-growers has sustained that rate for seven years. The complication specific to IMAX is that the recent rate sits on a record $1.28 billion box-office year, so the price is extrapolating from a high-water mark rather than a normalized base.

The methods we use to triangulate are unanimous on direction. Asset-based methods land far below the price, because IMAX's capital-light model means there is little book value to anchor to. Earnings-power approaches, which capitalize current profit without much growth, sit well below. Peer-multiple methods land under the price too, though the cohort here, precision-instrument and industrial-technology companies, is an imperfect comp for a premium-cinema network operator, so it is a directional rather than a precise read. Only the growth-driven cash-flow method reaches the price, by carrying the recent growth forward. That pattern, where only the forward-growth family gets there, marks the premium as a bet on durable compounding that the static frames cannot price; for IMAX, that compounding depends on the box office and the install base both staying on their current trajectory.

Solvency is not the issue. Net debt of about $98 million is roughly 1.3 times a year's operating income, interest coverage runs above ten times, and the share count has edged lower. The balance sheet comfortably supports the business through a weak film year. What bounds the downside is therefore not leverage but the gap between the price and where the cycle-independent methods land. The buyer at this price is underwriting a premium-format network at a multiple that needs the box office to keep setting records and the installation pace to hold, with a 434-system backlog as visible growth and a hit-driven content cycle as the swing variable.

Catalysts

The headline catalyst is the record itself. IMAX closed 2025 with $1.28 billion in global box office, up 40% year over year and 13% above its 2019 record, with regional records of $449 million in North America, $407 million in China, and $427 million in the rest of the world. The network reached 1,864 systems across 91 countries, with 160 installed during the year, up 10% from 2024, and a backlog of 434 systems. Local-language content was the standout, reaching $405 million in box office, 66% above the prior record, from a slate of 67 international films across 14 countries.

The forward path is mapped in the 2026 guidance: approximately $1.4 billion in global box office, which would be another record, alongside 160 to 175 system installations and a local-language slate expanding to 75 titles. The events to watch are the actual film slate landing through the year, because the box-office number depends on which titles release and how they perform, and the quarterly installation count, which converts the backlog into recurring revenue. A strong Hollywood and international lineup pushes IMAX toward the guidance; a thin or underperforming slate is the most direct risk to it.

Peer Cohorts (Per Segment, With Filing Citations)

Content Solutions (reported)

• CNK (Cinemark Holdings, Inc.)
• FY2025 10-K: …and other content and work diligently with film distributors to license content that we believe will be most successful in our theaters. We play mainstream films from many different genres, such as animated films, family films, dramas, comedies, horror and action films. We offer content in both 2-D and 3-D formats in…
• FY2025 10-K: …diverse alternative content that appeals to a broad consumer base. We also continue to invest in strengthening and leveraging our omni-channel marketing platforms and loyalty programs to expand our audience base, increase moviegoing frequency and strengthen loyalty to our brand. Additionally, we seek to drive…
• AMC (AMC ENTERTAINMENT HOLDINGS, INC.)
• FY2025 10-K: …with its sizable retail shareholder base and convert shareholders into AMC customers. AIC allows our shareholders to self-identify through our website and receive special offers and important communications. As part of AIC, domestic members must sign up for a Stubs account, which includes providing additional…
• FY2025 10-K: …Guests then have the items ready upon arrival and available at dedicated pick-up areas or delivered to seats at select theatres. Our MacGuffins Bar and Lounges ("MacGuffins") give us an opportunity to offer alcohol to our legal age customers in our U.S. markets. As of December 31, 2025, we offered alcohol in 386…
• LYV (LIVE NATION ENTERTAINMENT, INC.)
• FY2025 10-K: …received from outside parties such as landlords and noncontrolling interest partners or replacements funded by insurance proceeds. We manage our working capital on a consolidated basis. Accordingly, segment assets are not reported to, or used by, our management to allocate resources to or assess performance of our…
• FY2025 10-K: & Advertising Our Sponsorship & Advertising segment manages the development of strategic sponsorship programs in addition to the sale of international, national and local sponsorships and placement of advertising such as signage, promotional programs, rich media offerings, including advertising associated with live…
• WBD (Warner Bros. Discovery, Inc.)
• FY2025 10-K: …content consumption patterns. The ways in which viewers consume content, and technology and distribution models in the media and entertainment industries, continue to evolve. New distribution platforms, as well as increased competition from new entrants and emerging technologies and the availability of alternative…
• FY2025 10-K: …of the network and ratings as determined by third-party research companies, prices charged for advertising and overall advertiser demand in the marketplace. 11 Our services also compete for their target audiences with all forms of content and other media provided to viewers, including broadcast, cable and local…
• MSGE (MADISON SQUARE GARDEN ENTERTAINMENT CORP.)
• FY2025 10-K: …content and other content that is material to our business. Theft of our intellectual property, including content, could have a material negative effect on our business and results of operations because it may reduce the revenue that we are able to receive from the legitimate exploitation of such intellectual…
• FY2025 10-K: …alternative uses for the public's entertainment dollars. The primary geographic area in which we operate, New York City, is among the most competitive entertainment markets in the world, with extensive performing arts venues, numerous major professional sports teams, and countless museums, galleries, movie theaters,…
• TKO (TKO GROUP HOLDINGS, INC.)
• FY2025 10-K: …media), which lowers the barriers to entry and increases the competition for viewership and revenues. We must successfully adapt to and manage technological advances in our industry, including the emergence of alternative distribution platforms. If we are unable to adopt or are late in adopting technological changes…
• FY2025 10-K: …the amount paid by the establishment. The Company owns and operates its own over-the-top ("OTT") platforms, UFC FIGHT PASS, WWE Network and PBR Ride Pass that engage customers through a monthly subscription-based model. Access to UFC FIGHT PASS, WWE Network, PBR Ride Pass is provided to subscribers and revenue is…

Technology Products and Services (reported)

• DLB (DOLBY LABORATORIES, INC.)
• FY2025 10-K: …materials, labor, manufacturing overhead, amortization of certain intangible assets, and certain third party royalty obligations. Services revenue consists of fees charged to support theatrical and television production for cinema exhibition, broadcast, and home entertainment, including equipment training and…
• FY2025 10-K: …experiences to their audiences, creating a virtuous cycle of product development, improved experiences, and sustained demand for our solutions. We also work closely with technology developers to create and promote standardized technologies that enable content to be enjoyed any place, any time on a broad range of…
• COHR (COHERENT CORP.)
• FY2025 10-K: …and transport networks, and datacenter solutions necessary to meet the accelerating global bandwidth demand. We are a global technology leader in optical communications, providing materials, subcomponents, components, modules, subsystems, and systems to optical component and module manufacturers, networking equipment…
• FY2025 10-K: …tailor the optical and physical properties of technically challenging materials, components, and photonics-based solutions across our target markets. The ability to produce these complex materials, and to control their quality and in-process yields, is an expertise of the Company that is critical to our customers. In…
• LITE (Lumentum Holdings Inc.)
• FY2025 10-K: …and our broad product and manufacturing technology portfolio to create innovative and valuable solutions that enable our customers to win in their markets. Competition We compete against various public and private companies in the industrial and consumer markets we serve. Mergers and Acquisitions We evaluate…
• FY2025 10-K: …Our products enable high-capacity optical links for cloud computing, AI/ML workloads, and data center interconnect ("DCI") applications, as well as for communications service provider networks. Our offerings support access (local), metro (intracity), long-haul (intercity and global), and submarine (undersea) network…
• CGNX (Cognex Corporation)
• FY2025 10-K: TEMENTS Recognizing Revenue When (or As) the Performance Obligations are Satisfied The Company recognizes revenue when it transfers the promised goods or services to the customer. Revenue for standard products is recognized at the point in time when the customer obtains control of the goods, which is typically upon…
• FY2025 10-K: …may remain higher than planned, which could materially adversely affect our business, financial condition, and results of operations. Risks Related to Information Technology and Intellectual Property Information security breaches may adversely affect our business. We rely on our information technology systems,…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

IMAX FY2025 results, 10-K · IMAX 2026 guidance · IMAX FY2025 results, press release · IMAX 2025 commentary