SALT LAKE CITY — Value growth analyst Julian Lin doesn't hold much stock in MoviePass' parent company Helios and Matheson Analytics Inc.
In a new post for Seeking Alpha, titled "These numbers may change your mind about MoviePass," Lin dives into whether the parent company is worth Wall Street's interest, and whether you should consider HMNY and MoviePass Inc. a viable business idea for the future.
There's a lot to unpack here. To sum up the article, Lin uses HMNY's first-quarter results to show how the company may be tricking people into thinking it's doing better than it is.
"HMNY continues to fall and I am warning readers to not buy into this thinking that this is the next big thing," he writes.
He writes that certain things need to happen for MoviePass to keep its business afloat.
"While I do view this as a very clear short, the main and most important thing which would be very bullish would be if subscribers started seeing fewer movies as this would decrease expenses, and if they also simultaneously started buying more concessions," he writes. "I however do not see this as being so likely as the only reason to have the service would be to use it frequently, and fewer visits also would imply fewer opportunities to purchase concessions."
Lin opines that HMNY is a cheap stock investment, but it "does not currently present any potential value and is a strong short candidate."
Lin says these estimations are based on his own opinions and he has not been paid to write the piece, nor does he have any relationship with a company whose stock is mentioned in the article.
HMNY plans to add new features to MoviePass to inspire more people to buy the subscription service. As the Deseret News reported, the company wants to add a new family plan, an option to see movies in premium formats like 3D and IMAX, and a bring-a-friend feature to get more moviegoers involved.
Back in early May, Bloomberg reported that HMNY only had $15.5 million cash on hand, despite the company spending close to $21.7 million in a month.
HMNY even called MoviePass' business model "highly uncertain," according to Bloomberg.