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AMC Price Target Raised, Sell Rating Affirmed at Citi

AMC stock has more than tripled in the past six months as the Reddit crowd has gone gaga for the theater chain.
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AMC Entertainment  (AMC)  shares soared after Citi analyst Jason Bazinet nearly doubled his price target on the world’s biggest movie theater chain to $3.70 from $2.

To be sure, he kept his sell rating.

AMC recently traded at $16.23, up 19%. The stock has more than tripled (up 236%) in the past six months, as the Reddit crowd has gone gaga over the meme company.

As for Bazinet, he said AMC remains overvalued, Bloomberg reports. The company's "elevated leverage [represents] an added risk to an uncertain recovery," he said.

AMC got hammered by the pandemic, which still is limiting attendance at its theaters. But the stock price surge has enabled it to raise capital cheaply.

In other AMC news, its British cinemas last week recorded their busiest week of ticket sales since the pandemic began, offsetting the departure of a key investor in the company.

AMC said its largest shareholder, China-based Wanda Group, had sold its stake in the group "through normal open market trading to a widely dispersed array of buyers on the New York Stock Exchange."

AMC's U.S. prospects heading into the Memorial Day weekend are also looking brighter, with domestic coronavirus cases falling and vaccinations rising.

AMC shares gained last Tuesday alongside other meme stocks as day traders renewed their bets on shares of companies they feel they can collectively move higher.

On May 13, AMC said it completed an offering of 43 million shares. The offering brought AMC $428 million of new capital, before commissions and fees, at an average price of $9.94 a share.