AMC REDDIT MOVIE
The movie theater industry has been hit especially hard by COVID, and some number of movie goers may never return to the theater as a result. The movie theater was feeling pressure from home viewing options prior to the pandemic. This level of interest payments would appear unsustainable for the heavily leveraged AMC corporate finance structure. That scenario of steadily higher rates over the longer term could increase AMC's interest payments by over $200M on top of the $338M AMC already pays. The current trajectory of interest rates could steadily rise more than 4% over the next 24 months. It's unclear if AMC can sustain this higher level of interest payments. For example: If AMC's borrowing costs go up 2%, then debt obligations increase another $100M in annual cash interest on top of the $338M they pay already. Then there's the huge accumulation of $5B in debt that appears to be unsustainable in a rising interest rate environment. However, the share count increased massively making any lasting price appreciation for this stock far less likely. This gift of a capital infusion enabled AMC to successfully avoid bankruptcy in the near term. The size of the dilution that management issued was basically a last resort for the company to exploit its elevated share price. These SEC filings illustrate that AMC was a weak company fundamentally prior to the huge amount of dilution that took place. The massive 500% dilution that has been issued by AMC management since those January 2021 days has dramatically altered the narrative for this trade. Taking great pride in being an original AMC ape does not mean that my allegiance to the long side of the AMC trade is eternal, however. Packed a bag lunch and snuck my grub into the theater under my jacket. This and the fact that as a kid I actually saw all five of the Planet of the Apes movies in one day at the local theater. This AMC long trading call delivered a 500% gain, and supports my claim to being one of the earliest AMC apes. I issued this Trade Alert in my marketplace service at $5 (IBKR) Within 48-hours after my Trade Alert posted, the shares of AMC soared to $25. The weekly chart below indicates the date of my Trade Alert. In fact, I like to believe that I was one of the original AMC apes who posted here on 1/25/22 to buy AMC at $5 per share inside of my Trader's Idea Flow service on Seeking Alpha. This retail experience is foundational for my affinity for the retail investor community.
AMC REDDIT LICENSE
My long history as a retail stockbroker and individual retail trader dates back to 1986 when I earned my Series 7 license and worked for NYSE-member firm Oppenheimer & Co.
Of course GameStop ( GME) is the other most well-known meme stock. Massimo Giachetti/iStock Editorial via Getty ImagesĪMC Entertainment ( NYSE: AMC) is one of the two primary meme stocks that retail " apes" have dominated.
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