As much as we would like to believe: AMC “probably” (maybe) has a decent future in a few years from now, but currently, it sits on a negative free cash flow of $348 M, which is actually worse than last year, but retail investors don’t care. They also don’t care the fact that movie ticket sales have been in decline for over 2 decades. They simply want the play the “hedge-fund” game.
What’s Happening: Highly shorted stock AMC was +2.73 (19.96%) end of the session & another +0.67 (4.08%) after hours.
Why It’s Happening: Despite the fact that short-sellers and analyst keep releasing news that the market cap & price for $AMC doesn’t make sense, the retail investor group “WallStreetBets” (WSB) has decided to retaliate & continues to plow into stocks like $AMC & $GME because they “like” the stock.
Our Take: While hedge-funds keep screaming that the fundamentals don’t make sense for $AMC. Has it ever? While they continue to manipulate the market whenever and however they wish without care of fundamentals. When hedge-funds manipulate, they are rewarded, but when retail traders do the same thing, they are ridiculed. In simple terms, we think the retail investors are simply playing the “Hedge-Fund” game.
Disclaimer: We are not offering any financial advice. Please invest at your own risk. We are not liable for any loss or gain. The article is the opinion of the author.