Home NewsStock Market News Cineworld bankruptcy rumors drag AMC stock price, but preferred stock APE soars on first day of listing | Anue Juheng – US Stock Radar

Cineworld bankruptcy rumors drag AMC stock price, but preferred stock APE soars on first day of listing | Anue Juheng – US Stock Radar

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Cineworld bankruptcy rumors drag AMC stock price, but preferred stock APE soars on first day of listing | Anue Juheng – US Stock Radar


Shares of AMC Entertainment Holdings (AMC-US) tumbled nearly 40% in premarket trading on Monday and tumbled nearly 30% after the open. Mainly because Britain’s Cineworld may declare bankruptcy before its preferred shares are about to be listed for trading, spooking investors.

AMC’s preferred stock began trading on the New York Stock Exchange on Monday under the ticker symbol “APE.” The shares, which will have the same voting rights as common stock, are currently traded as separate securities, the company said. Shares of the preferred stock jumped more than 36% after the market opened on Monday.

“AMC’s APE offering is somewhere between a stock split and a stock dividend,” said Rick Meckler, a partner at Cherry Lane Investments. “AMC is trying to have enough liquidity to service its debt, and the fundamentals seem to be better. There has been a really good balance between not destroying the stock price until it’s low.”

Cineworld, which owns Regal Cinemas in the U.S., warned that it could file for bankruptcy as it struggles to pare debt that has soared during the pandemic, triggering a drop in AMC shares.

Shares in retail speculator favorite AMC hit a 2-month low if losses persist after reaffirming a “relatively weak” third-quarter 2022 movie schedule on Friday.

Sophie Lund-Yates, an analyst at Hargreaves Lansdown, said: “The previous dramatic shift in how moviegoers want to watch the latest hits is unlikely to reverse or get better for cinema chains. “

The Covid-19 lockdown has severely impacted the cinema business. However, AMC managed to raise $1.8 billion in 2021, capitalizing on a rally sparked by retail investor interest in meme stocks that contrasted sharply with Cineworld’s fortunes.

AMC shares have risen more than 150% since the end of 2019, while Cineworld shares have fallen about 99% over the same period.

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