The Cineworld share price has soared 300%! Should I buy now?

first_imgThe Cineworld share price has soared 300%! Should I buy now? Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Rupert Hargreaves | Sunday, 28th February, 2021 | More on: CINE The Cineworld (LSE: CINE) share price has risen in value by around 300% since the beginning of November. This outstanding performance puts the stock in the ranks of the best-performing London-listed firms over the past six months. Unfortunately, this performance only tells us part of the picture. Over the past 12 months, the stock is off around 41%. Investors who were unfortunate enough to buy the stock close to its five-year high of around 324p in mid-May 2017 have seen a loss of approximately 70%.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Still, past performance should never be used as a guide to future potential. As the world looks forward to opening up and moving on from the coronavirus crisis, the Cineworld share price, and other companies like it, could continue to move higher as profit and revenue growth returns. As such, I’ve been taking a closer look at the stock to see if it could be worth adding some shares to my portfolio today. Cineworld share price outlook Under the current UK reopening plan, all coronavirus restrictions will be lifted by the middle of the summer. That suggests Cineworld will be able to open its theatres in the UK by this date.However, just because they’re open doesn’t mean customers will return. What’s more, the group has operations around the world. So, even if the UK manages to stick to its plan, it could be some time before all of Cineworld’s venues are back in business. Even then, it could be years before customers feel comfortable enough to return. That could mean it will take years for the firm’s sales to return to 2019 levels. Indeed, they may never return to this level. Of course, that’s the worst-case scenario. In the best case, consumers could return quickly and splurge funds saved throughout lockdown. Some economists are already predicting a significant increase in consumer spending when lockdowns are lifted due to pent-up demand. In this best-case scenario, the Cineworld share price may increase further from current levels. But there are other risks to the company’s success. It has a lot of debt, and the rise of online streaming has drawn customers away from cinemas. Big payout Management seems optimistic the group will be able to return to previous levels of activity. It recently put in a bonus scheme that will pay out a total of £208m if the Cineworld share price returns to 380p in three years. This provides an enormous incentive for management to drive the share price higher and create value for shareholders. Overall, I think the Cineworld share price could produce large returns for investors, even after its recent performance. However, these returns are far from guaranteed. As such, I think there’s too much uncertainty surrounding the outlook for the business for me to buy the shares.So, I wouldn’t buy the stock right now. I want to wait and see how the reopening of the economy goes and its impact on Cineworld before taking a position. Get the full details on this £5 stock now – while your report is free. Image source: Getty Images FREE REPORT: Why this £5 stock could be set to surge Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img Our 6 ‘Best Buys Now’ Shares I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Simply click below to discover how you can take advantage of this. Enter Your Email Address Are you on the lookout for UK growth stocks?If so, get this FREE no-strings report now.While it’s available: you’ll discover what we think is a top growth stock for the decade ahead.And the performance of this company really is stunning.In 2019, it returned £150million to shareholders through buybacks and dividends.We believe its financial position is about as solid as anything we’ve seen.Since 2016, annual revenues increased 31%In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259Operating cash flow is up 47%. (Even its operating margins are rising every year!)Quite simply, we believe it’s a fantastic Foolish growth pick.What’s more, it deserves your attention today.So please don’t wait another moment. See all posts by Rupert Hargreaveslast_img

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