National CineMedia, Inc. (NCMI) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA against its history

Needs positive EBITDA and price history.

P/B below the industry

National CineMedia's price-to-book of 0.55 is below the Business Services median of 0.82.

Trading below fair value

The share price of $1.86 is below our fair value estimate of $2.29.

Margin of safety under 20%

The price is 18.7% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -0.8% a year over the last three fiscal years, short of the 10% we look for.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew 4.5% over the last twelve months; the Business Services median is 4.7%.

Guidance issued

The latest outlook (second quarter of 2026 total revenue, May 12, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin slipping

Gross margin was 94.1% over the last twelve months, against 94.7% a year earlier.

Return on equity

Needs positive equity and five years of results.

Return on capital under 10%

Return on invested capital was -9.6%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

National CineMedia's return on equity of -7.9% is above the Business Services median of -39.2%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin below its 5-year average

Net margin was -10.7% over the last twelve months, against a 5-year average of 71.8%.

Net margin below the industry

National CineMedia's net margin of -10.7% is below the Business Services median of -9.4%.

Low debt

Debt is 1.6% of shareholders' equity, under the 40% we consider low.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 423% of total debt.

Interest not well covered

Operating income covers interest expense -17.9 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.50 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 0.79; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

National CineMedia paid dividends worth 3.2% of the share price over the last twelve months.

Yield below Treasuries

The 3.2% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; National CineMedia yields 3.2%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 8 fiscal years.

Earnings cover

Needs dividends paid and net income.

Covered by free cash flow

Dividends take 47.3% of free cash flow.