Sit back and enjoy the show! AMC $ 14B market value rises Art and Culture News

Shares of the U.S. film company have risen more than 1,250 percent so far, driven by retail investors and Reddit users.

Enthusiastic retail investors at AMC Entertainment Holdings Inc. have valued the company’s market value for $ 14 billion for the first time.

Shares of the day’s rally rose 49%, most since the end of January at 3:15 p.m. in New York, when the value of the Leawood, Kansas company jumped to record highs. The volume also rose, changing more than 600 million shares manually, four times the average of the last five sessions.

AMC’s recovery has been fueled by individual investors eager to save the movie theater industry after raising more than $ 1 billion to avoid bankruptcy in recent months. The stock has risen by more than 1250% so far.

CEO Adam Aron has taken over the rally driven by Reddit and has spoken to new retail investors in conference calls. The stock has more than doubled since the AMC reported quarterly results on May 6, adding $ 10 billion in value. Thursday’s milestone stands below the market value of $ 216.8 million in April 2020.

Chad Beynon, an analyst at Macquarie Securities, has acknowledged the mania that can be created by individual investors while the AMC waits to continue throwing in debt and lease obligations before it becomes more constructive in stocks.

“Reddit is a strong crowd, volumes have been off the charts lately, so it’s clear there was no demand before Covid,” he said over the phone. The company’s ability to raise money for the stock earlier than $ 10 a month was “the first time the company has benefited economically from the Reddit rally,” he said.

The money made by the AMC has been raised through sales of hundreds of millions of additional shares, which is a key driver for a massive rise in market value, despite stocks falling 20% ​​from the 2015 peak. There are more than 490 million shares of AMC currently traded, data collected by Bloomberg shows, nearly ten times the 52 million shares it had at the beginning of last year.

More capital

AMC-related debt has merged with the stock, setting new highs in recent days. According to Trace trading data, the company’s bonds, which were trading at a low 5 cents in November, are on par. This debt represents a large 12% coupon for 2026 bonds.

AMC’s bonds were among the highest performing in the U.S. high-yield market on Thursday, expanding the gains made earlier in the week.

The company previously said it would seek more financing, and some investors have proposed selling more shares to pay off or refinance more than $ 10 billion in debt.

The film chain will “carefully consider raising additional capital in any way we think of it” and is focused on unlocking it, Aron said in a call to discuss the results for the fourth quarter in March.

The company’s recent renaissance at the hands of individual investors has pushed market value to more than double the $ 4.17 trillion peak in April 2017 before this year’s trading. In other words, AMC has consistently added more than $ 1 billion in each of the last three sessions, more than double the value at the beginning of the year.

The ability of the movie theater company to publish strong box office numbers will be important as it reopens in major markets like New York and California, as is the importance of B. Riley Securities Analyst Eric Wold on the phone. Wold dropped shares from buy to neutral on Wednesday, citing valuation concerns.