AMC Stock Price Hits New 52-Week Lows
Is this it for AMC (NYSE:AMC). The beloved meme stock and its APE Preferred Shares (NYSE:APE) both hit fresh new 52-week lows this week, sending the combined AMC stock price value down to about $8.52. It’s been a rough ride as of late, with APE stock continuing to fall since they were first released back in August. With a terrible August and September at the box office, can AMC recover with a strong holiday season?
I’ve been fairly bearish on meme stocks over the past couple of years. Sure, I’ve lost out on some of the sort squeezes, but nearly all of these rallies have been completely erased since. AMC in particular has had a tough time with their business, and it seems like everyone is seeing through the APE shares as another form of stock dilution. But this is not to say that AMC shares are done for. There are some positive catalysts on the horizon that are certainly worth discussing.
A New Partnership and Holiday Blockbusters
Earlier this week, AMC announced a new partnership with streaming giant Netflix ($610.56|-0.51%). CEO Adam Aron revealed this deal has been four years in the making, and while he made it seem like it is an exclusive deal with AMC, it is certainly a positive step forward for both companies.
The deal will see more than 200 AMC theaters show the featured Netflix movie Glass Onion: A Knives Out Mystery. Movie theaters will get an exclusive window before the movie is also released on the Netflix streaming platform, so investors shouldn’t expect this one event to shatter box office records. Still, it is a step in the right direction and opens the door for further showings in the future. The deal comes on the heels of AMC and Walt Disney (NYSE:DIS) agreeing to show Disney+ movies in AMC theaters.
On top of this new partnership, AMC is entering one of the best times of the year at the box office. Upcoming blockbusters like Black Adam and Black Panther: Wakanda Forever are sure to bring moviegoers to theaters. AMC is always running Halloween promotions, and will be looking to cash in with a slew of new blockbusters including the much anticipated sequel to Avatar.
Is AMC Stock a Buy?
So is AMC stock a buy at these depressed levels? While I have always advised against buying AMC stock, especially when it was in the $20’s, the valuation has certainly come back down to Earth over the past couple of months. Unfortunately, a new partnership with Netflix and the upcoming blockbusters still aren’t enough to sway me. Given the current prices, it might almost make sense to scoop up some APE shares if they continue to fall. If these are intended to be transferable at a one to one ratio in the future, it could be an interesting arbitrage opportunity right now. Still, this is nothing but a gamble right now, as this market environment is completely turning to a risk-off sentiment. AMC and APE might be at their 52-week lows, but I still think they have further to fall this year.
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