Bulletin
Investor Alert

New York Markets After Hours

Dec. 15, 2020, 7:01 a.m. EST

Why AMC Entertainment Is Not Bankrupt Yet

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    AMC Entertainment Holdings Inc. Cl A (AMC)
  • X
    Cinemark Holdings Inc. (CNK)
  • X
    AT&T Inc. (T)

or Cancel Already have a watchlist? Log In

Dec 15, 2020 (Baystreet.ca via COMTEX) -- Previously bet on as a destined for bankruptcy, AMC Entertainment /zigman2/quotes/200235402/composite AMC +15.40% is enjoying an uptrend. The stock bottomed at $2.00 at the height of fears the coronavirus would never end. Although the U.S. is suffering from worsening infections and casualties, the vaccine rollout brings hope.

Markets are betting that AMC and Cinemark /zigman2/quotes/200040530/composite CNK +0.78% will recover.

On Dec. 11, AMC secured a $100-million debt financing from Mudrick Capital Management. On the same day, it said it would sell 21.978 million shares in a private placement, raising around $80 million. AMC now has over $300 million on its balance sheet.

The movie theatre chain needs $750 million to remain viable in 2021. Although AT&T /zigman2/quotes/203165245/composite T +1.25% said it would launch all movies in theatres alongside streaming on HBO Max, AMC will get some of that revenue. Studios cannot afford to rely on box office ticket sales alone. The subscription model has rich margins the more sign-ups it gets. Investors buying AMC or CNK stock are betting that people will prefer the movie experience, the popcorn, and the night out than to stay at home streaming a new release.

AMC is a risky proposition. It needs more than 10-25% in movie capacity utilization. Anything below that is a continued loss for the firm sitting on plenty of debt.

COMTEX_376189043/2559/2020-12-15T07:00:32

Is there a problem with this press release? Contact the source provider Comtex at editorial@comtex.com. You can also contact MarketWatch Customer Service via our Customer Center.

/zigman2/quotes/200235402/composite
US : U.S.: NYSE
$ 9.29
+1.24 +15.40%
Volume: 113.08M
March 8, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$3.04 billion
Rev. per Employee
$140,744
loading...
/zigman2/quotes/200040530/composite
US : U.S.: NYSE
$ 24.48
+0.19 +0.78%
Volume: 3.60M
March 8, 2021 4:01p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$2.88 billion
Rev. per Employee
$38,128
loading...
/zigman2/quotes/203165245/composite
US : U.S.: NYSE
$ 29.99
+0.37 +1.25%
Volume: 55.83M
March 8, 2021 4:04p
P/E Ratio
N/A
Dividend Yield
6.94%
Market Cap
$211.24 billion
Rev. per Employee
$746,783
loading...

This Story has 0 Comments
Be the first to comment

Story Conversation

Commenting FAQs »

Partner Center

Link to MarketWatch's Slice.