12 Best Advertising Stocks to Buy Now

10. National CineMedia, Inc. (NASDAQ:NCMI)

Number of Hedge Fund Holders: 20

National CineMedia, Inc. (NASDAQ:NCMI) is a media company that operates in the American cinema advertising sector. It has around 18,400 screens in more than 14,400 theaters nationwide in 190 Designated Market Areas. The company’s platform also manages other kinds of advertisements and promotions in theatre lobbies. These include digital online advertisements across several out-of-home venues, such as restaurants, convenience stores, and even college campuses.

National CineMedia, Inc.’s (NASDAQ:NCMI) core audience predominantly comprises Gen Z and Millenials, and its continual strength is a key growth driver for the company. These groups accounted for 69% of its total viewership in fiscal Q4 2024, cumulatively reaching over 43 million moviegoers. National CineMedia, Inc.’s (NASDAQ:NCMI) reach in this young, highly sought-after audience compares favorably to sports programming.

Fiscal Q4 2024 marked the fifth consecutive quarter of above-expectation results, reflecting the company’s strategic focus on advertising growth as the box office continues its momentum. It reported revenue of $86.3 million for fiscal Q4 2024, exceeding its revenue guide of $82 million to $86 million. The company also partnered with 84 unique advertisers in the quarter, with retail emerging as the top advertising category. National CineMedia, Inc. (NASDAQ:NCMI) ranks 10th on our list of the 12 best advertising stocks to buy now.

On March 19, Texas Capital initiated coverage of the company with a Buy rating and $7.50 price target. The firm says domestic box office revenues are “primed for a solid double-digit percent increase” in 2025 with continued post-pandemic recovery. Therefore, the exhibitors hold the potential to jump back to pre-pandemic adjusted EBITDA levels by 2026, even if the total industry attendance stays below pre-pandemic levels, the analyst told investors in a research note.

Riverwater Partners Sustainable Value Strategy stated the following regarding National CineMedia, Inc. (NASDAQ:NCMI) in its Q4 2024 investor letter:

“National CineMedia, Inc. (NASDAQ:NCMI) operates the largest in-theater advertising network in the U.S., partnering with major cinema chains to deliver pre-show advertising and marketing content. NCMI’s dominant market position and exclusive partnerships with leading cinema chains provide a competitive moat in the theater advertising space. The resurgence of box office attendance, driven by strong movie slates and a post-pandemic recovery, supports revenue growth over the next couple of years. It has a net-debt free balance sheet and sports a double digit free cash flow yield.”