Shares of National CineMedia surged on their first day of trading as movie theater advertising got a standing ovation from Wall Street.
Company, a pioneer of the genre, is a venture of exhibs Regal, AMC and Cinemark. It’s a rare showbiz IPO and the richest initial public offering so far this year, raising nearly $800 million.
Shares, which now trade on the Nasdaq under the symbol NCMI, climbed 22% from an initial public offering price of $21 established earlier this week. It opened at $25.50, rose to a high of $26.50 and settled to end the day at $25.67.
National CineMedia chairman-CEO Kurt Hall, a longtime exhibition exec, rang the market’s opening bell.
Analysts have been upbeat on prospects for the company, which has few rivals and a large market to work with. Like it or not — and viewers generally don’t — commercials in movie theaters are here to stay. And they’re increasingly lucrative. National CineMedia distributes programming to nearly 13,000 movie screens nationwide operated by its founding members and other affiliates.
Company also handles lobby advertising, as well as corporate and other events.
In-theater advertising is one of the exhib biz’s biggest single efforts to discover additional revenue streams amid trends of flat to declining attendance.