NEW YORK (TheStreet) -- Shares of Lions Gate Entertainment (LGF) are up 2.80% to $34.85 in pre-market trade after it was reported that Dalian Wanda Group Co., which controls the second-biggest U.S. cinema chain, is in talks to acquire a stake in the film studio, billionaire chairman Wang Jianlin said, according to Bloomberg.
The Beijing-based company is interested in buying control of Lions Gate, the $4.7 billion studio behind the "Hunger Games" films, although its owners have only been willing to sell a minority stake, Wang said in an interview with Bloomberg.
Talks are at an early stage and may not lead to a deal, he said. Wanda has also held discussions about investing in Metro-Goldwyn-Mayer Inc., the independent producer of James Bond films, Wang said.
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Wang also said he wants to acquire large theater networks in Europe as part of his ambition to control 20% of the global cinema market by 2020.
TheStreet Ratings team rates LIONS GATE ENTERTAINMENT CP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate LIONS GATE ENTERTAINMENT CP (LGF) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year, increase in net income, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."