AMC Entertainment (NYSE:AMC), which operates movie theaters worldwide, closed Thursday at $2.29, up 9.86%. The stock moved higher after news broke that AMC completed a $150 million at-the-market equity offering. Investors are watching to see whether stronger box-office trends sustain the turnaround narrative. Trading volume reached 58.4 million shares, about 85% above its three-month average of 31.5 million shares. AMC Entertainment IPO’d in 2013 and has fallen 99% since going public.
How the markets moved today
The S&P 500 rose 1.73% to 7,393, while the Nasdaq Composite gained 2.54% to finish at 25,810. Within the entertainment space, industry peers Cinemark closed at $34.00 (+2.87%), and IMAX ended at $42.12 (-0.14%), underscoring mixed moves across theater-focused names.
What this means for investors
While most equity offerings prompt a share price decline, AMC rose 10% today after completing a $150 million at-the-market equity offering. This raise added financial flexibility for the company, as it could play a small role in whittling down its $3.9 billion in long-term debt and funding its $3.4 billion in leases.
CEO Adam Aron spoke to this on X, posting, “It is particularly encouraging that the AMC share price has risen by more than 50% during this time, showing presumably that investors’ confidence in a resurgent Box Office outweighs fears about dilution.”
While true, investors should keep in mind that this equity raise is a mere 4% of its long-term debt balance, so plenty of work remains ahead. That said, AMC’s EBITDA has been positive for the last three years, so things are trending in the right direction as box office results keep improving.
Should you buy stock in AMC Entertainment right now?
Before you buy stock in AMC Entertainment, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AMC Entertainment wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $442,220!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,230,114!*
That performance is why people listen. With a track record of beating the S&P 500 by nearly 5x, Stock Advisor offers a distinct advantage. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul.
