AMC Entertainment Holdings (AMC) shares have inched down in recent sessions following reports the cinema chain will authorize up to $150 million in share sale on Feb. 2.
The NYSE-listed firm has recently witnessed positive operational metrics, but investors are bailing on its stock nonetheless mostly because the equity offering presents a substantial dilution risk.
Following this week’s decline, AMC stock is down some 60% versus its 52-week high.
The U.S. box office has posted strong performance in recent weeks on the back of much-anticipated titles, including Avatar: Fire and Ash.
In fact, pre-Christmas attendance surpassed 4 million guests with $88 million in domestic revenue, demonstrating operational resilience in the core theatrical business.
But AMC shares have responded only “cautiously” to it as investors continue to prioritize balance sheet stability over near-term box office momentum.
The Leawood-headquartered firm has over $4 billion in debt with rapid cash consumption rates, signaling a precarious financial standing that threatens long-term viability.
This fundamental “disconnect” between operational recovery and share price performance reflects investor concerns regarding AMC’s reputation as the original meme stock as well.
High-risk investors still have reasons that go well beyond an improving box office to retain at least some exposure to AMC stock in 2026.
These include the management’s strong commitment to narrowing losses. In Q4, the movie theater company is expected to lose just $0.06 on a per-share basis, down a remarkable 67% versus last year.
Additionally, its near-term relative strength index (20-day) sits at about 38 at the time of writing, indicating bearish momentum is now approaching exhaustion.
Finally, the possibility of another short squeeze makes up for an additional reason for high-risk investors to stick with AMC shares this year.
Wall Street analysts also agree that the recent sell-off in AMC stock has indeed gone a bit too far.
