Cinemark Becomes Second-Largest Bet in Marathon's Concentrated Portfolio After $8.41M Share Acquisition

quiet_lurker · 2025-12-26T01:31:15+00:00

Marathon Asset Management LP has significantly invested in Cinemark Holdings, acquiring 300,000 shares worth $8.41 million, making it their second-largest equity position. This investment indicates strong confidence in Cinemark's recovery, driven by improved financial performance and strategic moves despite recent stock underperformance.

quiet_lurker

2025-12-26 01:31:15

Abstract generation in progress

A significant shift in one major asset manager’s theater stock bet just unfolded. Marathon Asset Management LP has established a fresh holding in Cinemark Holdings (NYSE:CNK), scooping up 300,000 shares valued at approximately $8.41 million as of late September 2025.

The timing matters more than the absolute dollar figure. This single position now commands 11.2% of Marathon’s entire 13F reportable portfolio—a weighty allocation that ranks Cinemark as the fund’s second-largest equity stake, just behind GrafTech International.

Why A $75 Million Fund’s 10% Bet Signals Conviction

Marathon manages just $75.12 million in publicly disclosed U.S. equities across fewer than 20 holdings. When a fund this size and this concentrated devotes over 300,000 shares to any single name, it’s not a casual move.

The portfolio snapshot tells the story:

GrafTech International anchors the portfolio at $27.1 million (36.1% of AUM)
Cinemark now sits in the #2 slot at $8.4 million (11.2% of AUM)
UnitedHealth Group comes in third at $4.3 million (5.8% of AUM)
John Hancock High Yield ETF at $3.3 million (4.4% of AUM)
Advanced Micro Devices rounds out the top five at $3.2 million (4.3% of AUM)

The Theater Play Nobody’s Talking About

Cinemark operates multiplex cinemas across the United States and South/Central America, pulling revenue from ticket sales, concessions, and on-screen advertising. The company manages approximately 5,868 screens as of mid-2022, positioning itself as a major motion picture exhibitor in the Americas.

At $29.59 per share (November 17, 2025), Cinemark stock has stumbled 6.69% over the trailing year—underperforming the broader S&P 500 by nearly 19 percentage points. Yet the company’s financial picture improved noticeably in 2025.

Recent Wins That Caught Marathon’s Attention

Despite sector headwinds, Cinemark generated $154.8 million in net income over the trailing twelve months against $3.15 billion in revenue. More compelling: the company posted $107 million in net income through the first nine months of 2025 alone, despite higher operating costs eating into margins.

The company also retired its pandemic-era convertible debt obligations and authorized a fresh $300 million share repurchase program. Management bumped the quarterly dividend by 12.5%—a move that typically signals confidence in sustained cash generation.

Marathon’s move into Cinemark appears driven by exactly these signals: profitable operations improving despite cost inflation, debt cleanup, capital returns accelerating, and a belief that consumers will keep buying theater tickets. The 10% portfolio weight suggests the fund sees lasting recovery in entertainment spending, not a temporary bounce.

At current valuations, this bet looks reasonable for a contrarian value approach betting on mean reversion.

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