AMC Entertainment Stock News and Forecast: Has AMC bottomed out yet?

• AMC stock continues to just about hold the lows.
• Signs show that equities may have bottomed out in the short term.
• AMC remains under pressure as S&P 500 earnings are likely to fall next quarter.

AMC stock is holding recent gains despite falling over 4% on Thursday. AMC so far appears to have bottomed out last week along with much of the equity market. AMC stock is just down 1% this week and is up 6% on the month. Whether that is a true bottom remains to be seen, but overall we remain bearish on equities until earnings estimates fall, likely after Q2 earnings.

AMC Stock News: Lightyear disappoints

The Toy Story spin-off Lightyear has disappointed critics, takings and your author. Having watched the film earlier this week, it is a far cry from the high watermark set by all the other Toy Story films. Word of mouth seems to be hurting takings, which are still dominated by Top Gun: Maverick and the latest Jurassic Park installment. Disney (DIS) stock also lost ground after the Lightyear figures, which were shy of projections. 

AMC CEO Adam Aron hits the front of the LA Times

AMC CEO Adam Aron has wisely engaged on Twitter with his AMC apes. This week he thanked them for a front page article in the LA Times covering the AMC story so far.

AMC stock sees new hedge fund taunts

The power of AMC apes has been questioned now that markets have turned bearish and meme stocks in general are getting badly hit across the board. This week the nemesis of AMC apes, hedge funds, saw one of their members openly taunt the AMC base on CNBC. Hedge Fund manager Cliff Asness of AQR Capital Management disclosed a short position in AMC and said on CNBC: "I dare all the meme stock maniacs to try to hurt us"...It's terrible on everything we care about," he said. "It is super expensive, super unprofitable and super high beta and volatility."..."Let them come. It's 12 basis points. They're crazy people, and I will not notice them, but they can have their fun."

This time 12 months ago that would have been enough to see a massive reaction from AMC traders, but so far the stock has failed to ignite. JPMorgan had a report out earlier this week that retail traders are finally capitulating, so perhaps that is truly the case.

AMC stock price target

Last week B. Riley Securities moved their price target to $11, and now the average consensus among Wall Street analysts is a sell rating with an average $9.24 price target. 

AMC stock forecast

We tend to agree with the negative thesis. While the stock market may bottom out later this year in the face of a recession, AMC faces a tough journey. Cinema attendances held up reasonably well during the Great Financial Crisis in 2008 onwards, and cinemas are often cited as recession-proof. But that may not transfer through to stock performance. From 2008 to 2010 Cinemark (CINE) fell about 60%, more or less in line with the broader market with the S&P down 50%. In times of recession cinema attendance holding up was largely down to escapism. Now with the rise of streaming, there is an alternative. 

AMC chart, daily