Three Reasons Why AMC Stock Is a Great Buy
AMC stock started the year at $2. Now, it’s worth more than two times that, with a tenfold jump in just one month. So, why is AMC stock so hot? The company has been generating a lot of buzzes lately. But what’s driving the recent surge? Here are three reasons why AMC stock is a great buy. Despite the recent drop in the price, the company’s stock has still been consistently a top performer in the past few years.
AMC’s growth is due to its movies business, so there isn’t any particular catalyst driving the stock’s price. The company’s earnings and financials have remained strong, and its stock’s IBD Composite Rating remains strong. In addition, its mediocre IBD RS Rating doesn’t mean it’s a bad buy. In fact, the price action is bullish for this movie theater chain.
AMC has recently sold shares worth $230 million, surpassing the gain made by its competitor GameStop. The company has also been able to increase its short interest by more than two times, taking up more than 18% of its float. Its IPO and post-pandemic reopenings have helped the company break new records and increase attendance. However, the underlying fundamentals remain mixed and there are still plenty of reasons to be skeptical.
As of 9:42 a.m. EDT on Monday, AMC stock was up 1.5%. After the overseas release of No Time to Die, AMC also reported a new all-time high of 3.9 million moviegoers over the weekend. But AMC isn’t a safe bet, as investors could lose their money if the company experiences a turnaround. The company’s overall earnings are still very impressive, and its dividend is well above the industry average.
Several other factors are helping AMC stock. The company’s debt load continues to grow and its business is performing poorly. However, a movie like Shang-Chi and the Legend of the Ten Rings performed well at the box office, boosting AMC stock. The film’s success is important for AMC. And it could help it service its massive debt burden. There are other factors that make AMC a great buy.
AMC stock fell 1% last month, falling 8% in the first month and 14% in the third quarter. While AMC’s profits are lower than its peers, the company’s revenue jumped 59% from a year ago. The company has 1104 theaters worldwide. The lag has been due to Disney’s reshuffled release dates for five Marvel movies. Despite its low-priced stock, it’s one of the most profitable.
Despite the recent decline in AMC stock, investors should not be afraid to buy the stock. The company’s performance isn’t correlated to its earnings per share. AMC’s growth rate is similar to that of the S&P 500. It’s a great buy if you’re a movie fan. But AMC stock’s fall can be very volatile, so it’s important to monitor the stock’s performance.
In the first quarter of 2019, AMC reported a net loss of 71 cents per share. The company welcomed 22 million moviegoers back to its theaters. The company also noted that it raised $1.25 billion in new equity capital during the quarter. During the second quarter, AMC’s revenue increased 8%, exceeding analysts’ expectations. Additionally, AMC’s box office sales broke successive records. Its new films helped boost AMC’s bottom line.
The company also has a solid slate of films to keep investors busy. The film schedule includes a variety of genres, including Westerns, horror films, and sports. AMC has the best slate of movies for the rest of the year, so its shareholders should be happy. The company’s recent earnings reports were also positive for the company. AMC stock has been a great investment for years. Its growth is fueled by a slate of movies and sports.
In addition to its new films, AMC’s new release schedule will be difficult for theater chains. The company’s new schedule is likely to negatively affect revenue in 2022 and 2023. It’s likely that the change will affect the movie industry in general. This is a major reason why AMC stock is a great buy. The new films will increase AMC’s audience, but it’s also a risky investment. For more resources on AMC stock.