AMC Entertainment Holdings Inc., the movie-theater chain that was once a meme-stock darling, continues to face challenges as its stock plummets to new lows. On Thursday, the stock closed at $5.30, marking a 5% decrease and extending its four-day losing streak. This downturn is the longest since November 13, 2023, when the stock experienced a five-day streak.
The previous record low close of $5.58 had been set just the day before on Wednesday. Prior to that, the stock had reached its lowest point of $6.07 on December 21, 2023. These figures reflect a significant decline from AMC's glory days as a meme-stock, when it achieved an all-time high closing price of $339.05 on June 2, 2021.
In an effort to address its substantial debt, which surpassed $5 billion in 2022, AMC entered into privately negotiated exchange agreements. Between December 28 and December 29, 2023, the company issued 3,258,657 shares of Class A common stock in exchange for $22.5 million in notes due in 2026. The implied value of the common stock issued was $6.94 per share, according to AMC. The company also emphasized that while it may engage in similar transactions in the future, it is not obligated to do so.
AMC has been actively working to alleviate its debt burden by implementing various strategies. In 2022, it initiated the APE special dividend and subsequently completed the conversion of APEs into AMC common stock in 2023, along with a reverse 1-for-10 split of common stock. Moreover, in December, AMC successfully concluded its latest at-the-market equity offering, raising approximately $350 million. Despite these efforts, AMC CEO Adam Aron has consistently cautioned about the company's liquidity challenges.
Over the past year, AMC's shares have experienced a significant slide, decreasing by 84.8%. In contrast, the S&P 500 index has witnessed a gain of 23.1%. According to a survey conducted by FactSet, out of seven analysts, four have assigned a hold rating to AMC, while three have given it a sell rating.
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