February 25, 2022
Movie Theater companies have a DMIᵀᴹ Index in the range of 0.22% to 25.14% with an average of 8.90%. The DMI Index calculation for AMC Entertainment Holdings, Inc. (AMC), Cinemark Holdings, Inc. (Cinemark) and IMAX Corporation (IMAX) are based exclusively on the valuation of their respective loyalty / customer data and rely on publicly-available sources only.
A higher DMI Index is generally preferable across companies and industries. By way of reference, internet companies have a higher DMI Index because most of their enterprise value is derived from data. For example, Google’s DMI Index is 93 percent because it generates most of its revenues from advertising based on user interaction data.
Data Monetization Index (DMI)
The YDC team recently published a DMIᵀᴹ for the Movie Theater industry (see Table 1). Based on public reporting, AMC and Cinemark have 50 million and 800,000 loyalty members respectively. We assumed that IMAX has 32,000 customers based on internal assumptions.
The DMI Index is the value of a company’s data relative to Enterprise Value. Enterprise Value is a key metric used in the investment community and is calculated as equity value plus long-term debt minus cash.The Loyalty Data Valuation methodology uses Customer Lifetime Value (CLV), customer counts, loyalty membership, revenues, gross margin, ticket size, purchasing frequency, churn rate, customer tenure and discount rates from publicly-available pre-COVID data sources only.
|Company Name||Enterprise Value||Data Valuation||DMI|
|AMC Entertainment Holdings, Inc||$18,430,000,000||$4,633,753,411||25.14%|
|Cinemark Holdings, Inc||$5,420,000,000||$73,312,753||1.35%|
AMC’s Loyalty Program Looks Like a Hidden Asset
Based on our analysis, the DMI Index for AMC is significantly higher than its peers due to untapped data value. In a previous blog, we discussed how several airlines monetized their loyalty programs to raise money during COVID-10. As mentioned earlier, AMC has a huge loyalty customer base of 50 million members that is potentially monetizable over time.
Obviously, a number of factors will impact these estimates including a more precise calculation of Customer Lifetime Value (CLV), loyalty membership, and the companies’ stance on data privacy. In addition, moviegoer behaviors may have changed permanently in the post-COVID era, and that will also have an impact on data valuation.