- NYSE:AMC dropped 15.04% on Wednesday, as meme stocks took a beating.
- #AMCDay fails to have the same effect as last time, even with Jim Cramer egging it on.
- CEO Adam Aron may have missed an opportunity to pay down debts in order to appease retail investors.
NYSE:AMC’s recent short squeeze is over, it’s about time we made that an official statement. Shares of AMC crashed again on Wednesday, as the meme stock fell by 15.04% and closed the trading day at $33.43. The stock is now down 53% from it's all-time high price of $72.62, which happened just four weeks ago. In the case of the meme stocks, the old saying rings true: the faster the stock rises, the faster it comes crashing down.
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Retail investors took to social media earlier this week in an attempt to coordinate another short squeeze. The hashtag #AMCDay was trending on Twitter and Reddit, and the last time this happened, it triggered a massive squeeze into the $60 price range. This time, even controversial CNBC personality Jim Cramer got into the act, when he tweeted “AMC Buyers Hold!”. The encouragement didn’t do much for the stock given its rapid decline over the past couple of sessions, which has led many to believe that this most recent short squeeze iteration has come to an end.
AMC stock forecast
In retrospect, AMC CEO Adam Aron’s refusal to hold a shareholder vote to sell more shares of the company may come back to haunt them in the future. Aron took the side of retail investors and stated that the company would not sell any new shares in 2021, thus avoiding further shareholder dilution. Of course, had AMC raised that capital it would have been able to pay off most of its debts, and the move looks worse this week now that the stock price has been cut in half.
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