AMC Stock Gets Small Bounce. But Will the Movies Come Back?
AMC Entertainment stock rallied from a low of $5.21 to a close of $5.54 yesterday, which represented a gain of $0.13, or 2.4%. The stock price moved on a reasonably strong first weekend of box offices reopening.
Now, the weekend’s box office total gross was $6.6 million. That represents an increase of 232% over the previous weekend’s gross. This is a positive sign that movie theaters might still be a viable business.
And it was by far the best weekend the movies have had since March. The weekend of March 13-15 saw a gross of $53.7 million before movie theaters shut down nationwide.
AMC Stock Sees Some Light (or Is It the Film Projector?)
AMC’s (NYSE: AMC) stock was up a bit over the last two days, likely due to the news that its theaters were opening up once again. AMC and other theaters saw grosses from the new Russell Crowe film ,Unhinged, which represented almost two-thirds of the weekend’s box office haul.
There are a number of steps movie theaters are taking to make customers feel safer in the age of COVID-19. For example, they have reduced the number of tickets they sell to each film, which increases the seat space available between movie viewers.
Something else AMC and other movie theaters are doing is encouraging their patrons to buy tickets online. This reduces contact between employees and customers, making the general moviegoing experience safer amid the pandemic.
Other steps to improve safety include increasing the amount of available hand sanitizer and cleaning more thoroughly and more regularly. It also helps to get the sticky butter sauce off the floor, I guess.
The Next Test: Tenet
The next major test of AMC’s stock will be the highly anticipated release of director Christopher Nolan’s latest mind-bending sci-fi blockbuster, Tenet. The film is set to open on September 3.
Nolan, of course, is the golden child of Warner Bros. Pictures, their Steven Spielberg, you might say. His filmography of critical and box office darlings includes classics like The Dark Knight, Inception and Dunkirk.
If Christopher Nolan can’t get audiences to put their behinds in AMC’s and other theaters’ seats, can anyone at this point? It’s highly unlikely, as Nolan remains one of the biggest names in showbiz and his releases are generally buzz-worthy spectacles.
Thanks, Tom. ❤️🎬🍿 https://t.co/QKBd37z1NZ
— AMC Theatres (@AMCTheatres) August 25, 2020
AMC Stock and the Future of the Movies
Ultimately, the success of AMC stock will be dependent upon the willingness of audiences to come back to the cinema. But will they?
It’s hard to say. On the one hand, we are likely months away from a COVID-19 vaccine. That will keep movie theaters depressed for quite a bit longer, and some may not make it.
But on the other hand, if theaters can hold out long enough for that vaccine, it’s possible AMC stock and other entertainment companies will be able to survive and eventually thrive again. This suspense thriller has all of us at the edge of our seats, that’s for sure.
About Brian M. Reiser
Brian M. Reiser has a Bachelor of Science degree in Management with a concentration in finance from the School of Management at Binghamton University.
He also holds a B.A. in philosophy from Columbia University and an M.A. in philosophy from the University of South Florida.
His primary interests at Investment U include personal finance, debt, tech stocks and more.