AMC was one of the biggest meme stocks back in 2021. But now it’s looking like a real company again.
The Odyssey has done over $650 million in ticket sales in its first 2 weeks…
Nolan shot the whole thing on IMAX cameras, the first film ever made that way.
And more than half of those US ticket sales were IMAX and other premium screens. Those seats cost more, and AMC keeps more of what they cost.
Spider-Man: Brand New Day opens Friday. Avengers: Doomsday opens December 18 in more than 4,000 theaters. Tracking has both of them finishing bigger than The Odyssey, and neither one has sold a ticket yet.
Meanwhile AMC just posted their biggest numbers in over 100 years of selling movie tickets when they reported earnings on July 20.
So the best quarter in AMC’s history closed before the biggest movies of the year ever reached the screen.
The company did more than move tickets. AMC earned $0.14 a share when Wall Street had it down for a loss, and it cleared $300 million in EBITDA for the first time in company history.
The stock is still under $2.50.
Records like that should not leave a stock this cheap, and the answer goes back to 2021.
Why Is AMC Still So Cheap?
If the numbers are this good, why is the stock only at $2.46?
The reason goes back five years.
Back in 2021, nobody wanted AMC. The theaters were dark and the company was telling everyone it might run out of cash.
Five months later it was up almost 1500%.
And it wasn’t done. On June 2 alone it closed up another 95% in a single session. Anyone short it got wrecked, and people quit their jobs over that chart.
Then the bill came. AMC sold stock over and over to stay alive, and in August 2023 it did a 1-for-10 reverse split. Every one of those moves left holders owning a thinner slice.
That split is also why the 2021 chart looks nothing like today’s quote. Ten old shares became one.
And AMC never stopped selling stock. There were 433 million shares a year ago. There are 722 million now.
They sold about 200 million new shares this year and used the cash to pay down debt. The company is healthier for it.
The share count is also why 2021 can’t happen again. There is too much stock out there now for anyone to squeeze.
So I trade it and I don’t hold it. The next time AMC needs money it will sell more stock, and I want to be gone before that.
How I’m Trading It
I took $16,638 out of AMC before the open on Tuesday.
I got in around $2.23 and I set a stop loss at $1.90, right where the 50 and 200-day moving averages come together.
It came back and tested $1.90 before the open on Tuesday, held, and I took my profits into the bounce.
I’ve bought stock for a good story before. I sat there for a year while the story stayed good and the chart stayed flat.
I’m not doing that again.
Pick your level before you pick your size. Keep the size small enough that being wrong is boring.
And if you’re watching AMC remember…the big movie money is still coming. The next earnings report is the first one with any of it inside, and nobody has seen that number yet.
But for the next four days theres an ever better setup I’m watching…
Click here to watch the video.
Stay sharp,
Jack Kellogg
*Past performance does not indicate future results
