AMC Entertainment Holdings (AMC) stock price trends lower despite $100 million debt offering

  • NYSE:AMC trims 2.94% despite the S&P 500 hitting new all-time highs.
  • AMC announces a $100 million debt offering to stay afloat as the COVID-19 pandemic continues.
  • Despite re-opening its doors, AMC has difficulties attracting customers in the current environment.

There are few companies who have been hit as hard as NYSE:AMC during the COVID-19 pandemic, and as the world slowly tries to get back to normalcy, it seems as though cinemas are being left behind. After surging of late, AMC dropped by 2.94% on Wednesday as shares fell to $2.97, despite the S&P 500 surging to new all-time highs amidst President-elect Biden’s inauguration. The stock has been the target of day traders recently attempting to capitalize on some good news from the beaten-down movie theater brand. Wednesday’s daily trading volume neared 180 million shares, which is far greater than its usual average daily volume of 33 million shares. AMC has returned a loss of 56% over the past 52-weeks to its very patient shareholders. 

AMC did get a boost on Tuesday as it announced a $100 million debt offering that would prolong its survival for the time being. Even as doors have re-opened in limited fashion, customers have been very reluctant to return to movie theaters as a form of entertainment. It does not help things that companies such as Disney (NYSE:DIS) have been releasing new movies directly to its streaming services, rather than bothering with releasing them in theaters. 

AMC stock forecast

AMC stock price chart

AMC has reiterated that despite the debt offering, there is still a very real chance of bankruptcy if the COVID-19 pandemic continues to affect its business. One of AMC’s biggest rivals Regal Cinemas recently announced it is hoping to re-open some of its theaters by Easter but even that is not a guarantee. The future of cinemas is very much in flux right now, especially if AMC were to continue to fall towards bankruptcy. 

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