AMC Stock Surges: Is This The Big Squeeze?
BERNARD ZAMBONIN AND DANIEL MARTINS, 21 July 2021
AMC stock (AMC) – Get Report bulls had a day of relief on Tuesday, as they saw the share price soar about 25% after weeks of painful declines. Following positive developments coming from CEO Adam Aron, momentum quickly shifted to the bullish side.
Could this be the beginning of the MOASS – apes’ long-awaited “mother of all short squeezes”?
Good news from the business
Bullishness on Tuesday may have been triggered by CEO Adam Aron. He announced long-term leases on two of the top five theaters in Los Angeles and added that others are coming soon.
The CEO’s statement supports AMC’s optimism about the reopening of the economy and the expected recovery of the business in 2021.
Retail traders spent Thursday morning buying the dip created by all the people digging the graves of meme stocks on Tuesday and Wednesday.
Amid heightened margin trading requirements and greater scrutiny on GME/AMC stocks, investors continue to look under every rock for signs of institutional trickery. A theory which was notably gaining attention by retail investors stemming from a recent AMC filing and Silver Lake’s convertible notes was believed to have larger implications than what is now known.
The more one zooms into the stock market’s underpinnings, the more surreal it gets. Today, the NYSE has designated AMC as a ‘threshold security’, shining further light onto the situation with AMC shares that fail to deliver.
Charles Schwab has raised margin requirements for short sellers shorting AMC and GME stock. The broker is adjusting 100% margin requirements for AMC on all long positions, and 200% on short term positions.
AMC Entertainment Holdings (NYSE:AMC) is going on the offensive, selling over $230 million worth of stock to hedge fund operator Mudrick Capital Management at a premium so it can use the proceeds to make acquisitions.