AMC Entertainment (AMC.US), US movie theater chain and one of the companies that was at the forefront of 'meme-stock craze', is slumping over 20% today! The move is driven by an announced share sale. AMC filed a prospectus to issue up to 40 million shares of common stock. This is a part of a recently approved equity distribution agreement that allows AMC Entertainment to issue up to 390 million new shares, worth around $4.2 billion (at current prices). Company plans to use proceeds from share sale to pay down debt and improve its liquidity position.
Interestingly, the company has struck a cautious note on the outlook for its shares in the filing and warned investors that price and trading volume volatility is very high and that investment in its shares is highly speculative.
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Open account Try demo Download mobile app Download mobile appTaking a look at AMC Entertainment (AMC.US) chart at weekly interval, we can see that even as the company is trading 25% week-to-date lower, this drop is barely noticeable on the chart following previous steep drops. Nevertheless, stock plunged below 2020-2021 lows today and reach a record low.
Source: xStation5
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