AMC Entertainment Holdings Inc. posted its longest rally since 2018 as individual investor desire to trade meme stocks was reawakened.
AMC ended the day higher by 0.6 per cent to US$14.03 even after traders circulated news that a 17 million share block trade was said to price at US$14.20 each. The movie-theater chain flipped between gains and losses amid heightened trading volume for a fourth straight-session.
XpresSpa Group Inc., another favorite of Redditors earlier this year, rallied 9.1 per cent to US$1.32 as penny stock Naked Brand Group jumped 4.9 per cent while cannabis stock Sundial Growers Inc. rose 4.7 per cent. The strength for some retail-focused companies came after Walmart Inc. boosted its earnings forecast on Americans’ desire to “get out and shop” while Macy’s Inc. also posted bigger-than-expected gains.
Social media has powered the latest gains for AMC, with the hashtag #AMCSqueeze trending over the past week on Twitter, in a call to recreate the heavy retail buying in January that forced investors out of bearish positions.
With more than 32 million shares traded early Tuesday, AMC was the second most active stock that trades with a market value above US$500 million, according to data compiled by Bloomberg. The stock’s now eight-day winning streak is its longest streak of advances since August 2018 with a 56 per cent rise pushing it to a two-month high.
The company has soared as its management embraced individual investors and internet traders after Chief Executive Officer Adam Aron cheered the stock’s resurgence on a quarterly earnings call. The movie-theater chain has continued to rally even after announcing on Thursday that it had raised about US$428 million by selling shares.
B. Riley analyst said Friday that the additional cash lowered the need for it to raise even more funds ahead of a rebound for the movie theater industry. CEO Aron said in the statement the money will allow it to better “tackle the challenges and capitalize on the opportunities that lie ahead.”