Shares of AMC Entertainment (AMC.N) edged lower on Friday, closing out a wild week with a gain of just over 83% as the action reinvigorated the meme stock craze and the investors behind it
“AMC has a very strong following of believers,” said Dennis Dick, proprietary trader at Bright Trading LLC. “They’re trying to hold strong, and they believe they’re going to drive this to the moon.”
The movie theater chain’s shares ended the day down 6.7% to $47.91 after trading in both positive and negative territory during the session.
AMC has been at the center of a fresh wave of buying by retail investors who hyped the stock in forums such as Reddit’s WallStreetBets, breathing new life into a phenomenon that began with January’s more than 1,600% gain in GameStop (GME.N). Meme stocks got the name because their explosion in trading volume stems from interest and promotion on social media.
The past week’s blistering rally saw the market capitalization of AMC, which was at the brink of bankruptcy not long ago, swell to nearly $24 billion and put its year-to-date gain at 2,160%. The rise in part reflects optimism about the re-opening of public venues like cinemas after pandemic shutdowns, but most analysts say that the scale of the rally is out of line with AMC’s fundamentals.