Soon 35mm film may go the way of the silent movie. A move to change movies' format from analog to digital is afoot. The major studios have already agreed informally to such a switch, says William Relyea of investment firm H.C. Wainwright. No longer will studios use film delivered in a can. Once converted to digital, the movie is encrypted and electronically sent to the theater's server. Little-known Access Integrated Technologies (AIX ) ``is positioned to profit best from digital cinema,'' says Relyea, whose rating on Access is buy. It has the software and capability -- booking movies into theaters, delivering the encrypted files, and managing the digital projection process. ``No other company offers that breadth of service,'' says Relyea. Access stock has rocketed from 3.30 in January to 7.88 now. On June 21, Access and privately held Christie Digital Systems announced a plan to help fund studios and exhibitors in moving to digitalization. Relyea says this will start ``a period of rapid revenue growth'' for Access -- well above his previous earnings forecasts of 45 cents a share in 2006 and $1.23 in 2007. Reuters Research rates the stock ``outperform.''
Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.
By Gene G. Marcial