Possibly boosted by the success of Avatar: The Way of Water, AMC (NYSE:AMC) closed Monday up nearly 23%.
The shares of AMC, one of the major “meme stocks” from the craze of early 2021, closed on Monday, Feb. 27, more than 22% in the green. The company is scheduled to release its earnings report on Tuesday. While most analysts expect another quarter of losses, its sales are widely expected to be over $1 billion thanks to the release of Avatar: The Way of Water.
AMC Continues its Two-Week Winning Streak
The shares of AMC Entertainment Holdings closed the trading day on Monday up nearly 23%. The company’s stock has been experiencing a near-continuous surge in price for almost a fortnight and saw a rise from $4.50 to $7.61. Generally, the company has seen a significant upturn since the beginning of the year, up more than 90%.
Its preferred equity—(APE)—while in the green YTD, has been experiencing a decline over the previous two weeks and closed Monday 5% in the red. According to a press release published in December, the contentious preferred equity is set to be converted into regular AMC stock soon. Still, the move has been somewhat controversial, making the exact date unclear.
While analysts are generally expecting AMC to report another quarter of losses. However, the release of James Cameron’s Avatar: The Way of Water—the world’s third highest-grossing film since its release in mid-December—is expected to have helped bring AMC’s total sales to over $1 billion.
“Meme Stocks” Since the Craze
While the companies issuing the two major “meme stocks,” GameStop (NYSE:GME) and AMC, have been considered near closing before the craze began, both have managed at least a partial recovery since. In March 2022, for example, AMC reported its strongest earnings in more than two years.
According to the company’s CEO, Adam Aron, a major force behind AMC’s decline and failure to fully recover has been the combined effects of the COVID-19 lockdowns and a subsequent decline in the number of theatrical releases coming out of Hollywood. Aron, who has largely embraced retail investors after the “meme stock” craze and garnered a significant following on Twitter, also believes that 2023 will be a far better year for his company.
GameStop, the main “meme stock,” also elected to use its popularity surge to revitalize its business. Since early 2021, the company has tried to expand its traditional brick-and-mortar operation by going digital and even entered the digital asset industry with its own NFT marketplace. While the company is in a far better state in 2023 than it was in late 2020, it didn’t rally as much as AMC - which is up 11% since the New Year.
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