AMC Networks Inc.'s (AMCX, Financial) stock fell 1.8% from $53.46 on Monday to $52.56 on Thursday after being downgraded from neutral to negative by Markit on Jan. 30.
The company also received backlash after an actor died on the set of "The Walking Dead" in July 2017, suffering from injuries sustained from a 22-foot fall. The mother of John Bernecker, the stuntman who died, filed a wrongful death lawsuit in January. She claims the network cut corners and provided an unreasonably low budget for stunts that led to profits being prioritized over safety.
AMC claims its safety procedures meet or exceed industry standards.
Stalwart Films, the company responsible for filming the hit show, says the accident was tragic, but disagrees that they did not take the proper safety precautions. The film studio did not use spotters or air bags during the stunt, however, which could possibly have mitigated the accident.
Bernecker's lawsuit, however, may have gained some steam this month when the Occupational Safety and Health Administration fined Stalwart Films $12,675 for "failing to protect employees from falling hazards." OSHA has not provided details of the investigation or about the cause of the accident.
There is reportedly film footage of the incident.
This is not the only legal battle the company is fighting, however. AMC is also facing a lawsuit for mischaracterizing seasonality at the box office.
On Jan. 17, The company was hit with a class-action lawsuit alleging it misled investors.
AMC says its highest performance is in the summer months and during the holiday season, but it failed to mention international operations traditionally have lower attendance in the summer.
Summer is often the least profitable in Europe, which investors argue the company failed to mention in regulatory flings after acquiring Odeon & UCI Cinemas and Carmike Cinemas over a year ago.
The lawsuit also claims the company failed to alert investors that Carmike was losing market share at the time of the acquisition.
Analyst ratings and earnings
A number of analysts have provided new ratings for the stock recently.
In addition to Markit's rating, TheStreet also downgraded AMC's stock on Jan. 29, along with several other analysts.
AMC's earnings for the third quarter, which were reported in November, underwhelmed investors. The company posted revenue of $648 million, missing the consensus estimate of $660 million. Revenue increased 2.1% from the prior-year quarter.
Earnings per share of $1.68, though, beat expectations of $1.15.
Net margins were 12.12%.
The company is less profitable than the average movie studio, with negative net profit margins of 4%.
Investors have been bearish on AMC recently, dumping 15,272 shares over the past three months.
AMC shares have declined 7% over the past 12 months and 22% from July highs of $67 a share. The company's stock has fallen approximately 3% since the beginning of the year.
Disclosure: Author has no stakes in the listed equities.
