Meme stocks have been the rage in recent years. Some stocks including AMC Entertainment Holdings Inc (AMC: US) have amassed a large following on platforms like Reddit.
With a current M Cap of almost $6.6 billion, AMC was previously covered on two occasions by 2iQ analysts in May ‘21 and June ’21. Back then, the company was still in recovery mode in the aftermath of the COVID-19 pandemic. Ticket sales were still lagging due to social distancing measures, and Insiders were lowering their holdings due to the risk AMC was bringing.
Regardless, the stock’s followers, referring to themselves as Apes still held on. Considering the recent turn of events and a million-dollar movie release, it seems there is hope for AMC after all.
Another Short Squeeze in the Works
AMC stock saw a heavily bumpy ride since 2022-beginning. The stock was priced at $26.52 on January 03 and fell in the third month of the year. It eventually picked up pace again, and now, for the past few days has been seeing large fluctuations.
At present, AMC’s short interest rate is almost 33.94%. The utilization rate is 100%, as it has been since February 07. To add to it, the number of shares on loan has risen to 175,401,216; the latter being its highest number year-to-date.
Despite the ongoing shorting, the bullish news is that AMC soared by almost 26.57% in the past 5 days. On May 26, the stock opened at $11.75. The next day, on May 27, it closed at $14.43 marking a price rise of nearly 22.80%.
While there were many optimistic events going in the entertainment stock’s way, one long-awaited film release could be responsible for the above price soar.
AMC gets the Need for Speed
Released almost 36 years after its prequel, “Top Gun: Maverick” opened on the Memorial day weekend. Immediately, the movie went on to gross more than $100 million during the single weekend, not only competing to be the highest-grossing film of Tom Cruise’s career but also skyrocketing entertainment stocks, like AMC. AMC reported that its theaters welcomed as many as 4 million customers to watch a screening of “Top Gun: Maverick”.
Not too far back, on May 16, the central bank of Switzerland announced that it raised positions in multiple American stocks, including AMC as well as Apple Inc (AAPL: US) and Tesla Inc (TSLA: US). The same day, AMC gained another investor in the investment management firm, Bridgewater Associates, founded by Ray Dalio. The headline was that Bridgewater had sold its shares of TSLA and bought stakes in AMC as well as Gamestop Corp (GME: US).
Furthermore, AMC reported its earnings for Q1 2022, and the numbers were eye-catching. Mentioning the success of past movies like Spider Man: No Way Home, The Batman, Doctor Strange in the Multiverse of Madness among others, AMC reported gaining $785.7 million revenues. This was an almost 429.8% increase from the company’s revenues for Q1 2021. CEO and Chairman, Adam Aron briefly mentioned the past ventures of AMC, which included the infamous investment in Hycroft Mining (HYMC: US) and launching NFT programs. He ended his statement with the words, “We will continue to take bold, decisive action to strengthen AMC for the future.”