AMC, the cinema chain, is probably in decline and cinema-going will soon become a thing of the past.
It's been 3 months since I wrote about this company and now I'll post again. The $AMC+0.8% which is forgotten I dare say, often "dubbed" also as a meme stock and for me a memory of my childhood when going to the movies was common and one looked forward to this social event.
Unfortunately, this society is really only going downhill. It has been making moves in recent months, even though shareholders don't like it, to raise capital to retire debts. In the wake of Covid and the pandemic closure of movie theaters, they decided to float $APE-17.9% stock (which was marked as a dividend payout) as a solution. In doing so, they hoped to make billions by listing the new shares, which would help the company pay off its debts and stave off bankruptcy.
Now came the next step, a 10:1 reverse split of common stock. The number of authorized shares of the company will increase to 550 million from the previous 52.5 million after the reverse split, allowing AMC to issue more than 390 million shares.
The share price has been steadily deepening over the past few days, and this is due to investors focusing on the fact that AMC will start issuing a large number of shares to resolve its debt balance. Eric Wold, analyst at B. Riley Securities, sees the stock conversion as a way for AMC to weather the extended post-pandemic recovery of the global exhibition industry as well as any future fallout from the ongoing writers and actors strikes in Hollywood.
Well, what are we going to think, it doesn't look good at all with this global company and unless there is some sort of idea, a revival ...I don't know myself, I fear that the cinemas and theatres will become maybe some conference rooms etc. We'll see, of course I'm not investing in this business even though I got burned at the beginning, but I wonder if it will go bankrupt or somehow survive the next few years.
What about you, how do you view this dying biz and do you still go to the movies or are you more comfortable watching streams from home? 😊
Interesting, I don't know this company, but the chart doesn't look good at all. I don't go to the movies much anymore. I go occasionally, but only 3 times a year at most. Maybe I should fix that, now that there are such interesting movies like Barbie, Oppenheimer, or Kazma's movie :D
The only time we go to the cinema is during a festival or with a child, but we go to local small cinemas. And the theatres, at least in our country, are subsidised, otherwise they wouldn't survive (I mean, the small cinemas are subsidised too).
As long as people want some social interaction then cinemas will survive, but I don't know if it would necessarily have to be some multiplex model with 10 screens? Personally, I've never picked up a movie on the spot, and you can get 2-3 screenings in one day in a small theater. Just someone with judgement needs to sit in the editing room and not send in mindless 200min pieces. AMC does not equal screening films in a cinema;)
I don't know the dates and I don't want to bullshit, but purely from my impression, I think that at least in the Czech Republic cinemas are still flying. I like them a lot. If they're showing something good, I'm happy to pay for it. It has a great atmosphere and it's a nice excuse to meet up with friends.