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Summary
- AMC stocks surged by more than 67 percent in the last five days.
- The company’s US$917 million fundraise draws investor attention.
- It plans to use the funds in reinforcing its operations in US, Europe, and the Middle East.
Although much of the world has been in a lockdown with little or no leisure activities to do, interests in theatrical business-related stocks at a time of pandemic may seem farfetched. But the popularity of the stocks of AMC Entertainment Holdings Inc. has generated quite a significant interest among investors.
The company, which operates high-end dine-in theatres, equipped with state-of-the-art power recliners and MacGuffins full bars in the US, Europe, and the Middle East, has seen its fortunes change in the stock markets despite COVID-19 restrictions.
So, what has changed that triggered an AMC stock rally in the US markets? Let us consider how the AMC stocks have performed in the past year, which may provide an answer to its unexpected rise.
@Kalkine Image 2021
AMC Entertainment Holdings Inc (NYSE:AMC)
Founded in 1920, this diversified media and entertainment business conglomerate is one of the oldest theatre companies in the US. Although its income has been hit like every other business due to the pandemic, it had recently raised $917 million in financial deals to boost its operations. The company said the funds would help keep its activities afloat through 2021.
The stocks of this NYSE-listed company were trading at US$ 4.96 per share on Jan. 27, 2021. It has a market cap of more than US$1.42 billion. The stock has advanced by 133.96 per cent in the first 26 days of January 2021. In the last five days alone, its stock value rose by more than 62 percent, while in the past three months by over 90 percent.
Although its price performance in the last six months also show a robust near 20 per cent growth, its value, however, declined by around 27 percent in the last one year. The company pays a quarterly dividend of 2.419 percent.
Since the company announced the raising of new funds on Monday, its stock prices have skyrocketed in the market, surging by over 43 percent in the last two days.
The company said that it had been raising the money in new equity and debt capital since Dec. 14, 2020, which would allow it to pull through this period of uncertainty.
Of the total amount, US$506 million were raised through equity and US$411 million in debt capital.
The company also hopes that the attendance in the cinemas in Europe and US would gradually increase, given the government push to vaccinate the population, which in turn boost its income.
AMC, which owns some 1,000 theatres and 10,700 screens across the globe, has constantly upgraded its facilities such as introducing its signature power-recliner seats, and quality food and beverage of choice.
