Let’s Go to the Movies! Investing in AMC

It may have been a short trading week this week but that didn’t stop theater chain AMC Entertainment from taking one heck of a rollercoaster ride in the markets… And if you were in the right place at the right time, you may have managed to make a small fortune! If not, though, don’t worry… you may have another chance coming your way soon!

The Pandemic Takes its Toll

One of the many sectors hard hit during the 2020 pandemic and the following aftermath was the entertainment sector. Specifically, the movie theater industry. During mandated quarantine, there was one thing we were always warned to avoid… confined spaces with crowds. Folks, that’s exactly what a movie theater is and as such, the industry pretty much shuttered its doors for over a year. Some of which have yet to – or are just starting to – open their doors once again.

One of the largest theater chains in the world, AMC, was not immune to the pandemic’s overall impact. And after being hit by a double whammy with customers being forced to stay away and their general supplier (Hollywood) cutting back distribution and leading to an overall decrease in revenue of 78%. Needless to say, it’s been a rough year for this once behemoth of a company.

Not to mention the fact that theater chains in general are already in a fight for their life against streaming services and home video. The pandemic may have only helped to push this already struggling industry over the edge.

Just a few short months ago, in fact, AMC was on the brink of filing for bankruptcy after receiving a $917 million infusion from investors.

AMC’s Luck Begins to Change…


This week, AMC’s luck appeared to change, however, as their shares soared 418%, which pushed the company’s market capitalization to more than $31 billion!

It didn’t take long for AMC fever to subside, though as the chain soon announced they were selling 8.5 million shares of stock to hedge fund Mudrick Capital for $230.5 million. Mudrick, in turn, sold the shares for a profit, abandoning their investment.

This bit of market action excited many and led several too quick AMC investments, but company officials warn that they could “incur substantial losses” amid the extreme volatility that has recently occurred in the company’s shares.

Savvy investors continue to watch the stock, however. Just waiting for what could be the last bellow of the great beast. And, for those who feel that the only direction for the company to currently go is up, their patience could be well rewarded as another surge in stocks would make those brave early investors a decent chunk of change for their initial investment.

As we sit here today, AMC’s stocks currently took a deep plunge as the company announced its plans to sell 11.55 million shares. Bringing the overall market value to 51.63 USD/share.

Learn More Here…

The markets are no place for the faint of heart… If you pride yourself on your willingness to take risks and, perhaps, gain great rewards, this could be the stock to do it for you!

If you’re interested in hearing more about this recent AMC action, we invite you to join the most recent Ask the Pros broadcast where our roundtable of market professionals sat down to discuss their thoughts on the stock and their plans for moving forward.

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