AMC climbs 15% as Reddit traders pounce on newly available stocks dropped by its biggest holder
- AMC Entertainment shares climbed 15% on Monday amid the excitement in retail.
- Wanda Group has sold almost all of its stake in the company, allowing more traders to participate.
- “We now own the future of this company!” a Redditor proclaimed on the Wall Street Bets bulletin board.
- See more stories on the Insider business page.
Shares of AMC Entertainment climbed to 15% on Monday as Redditors applauded the buying opportunity created after the company’s largest shareholder sold the remainder of its stake.
Chinese private conglomerate Dalian Wanda Group, which invests in shopping malls, sports and tourism, sold most of its remaining shares in the movie company, according to a friday AMC press release. The conglomerate reduced its stake to just 0.002% from the 6.8% previously reported, according to Bloomberg, citing regulatory documents.
Wanda, who bought AMC in 2012 for $ 2.6 billion, began pulling out of the company in December after the company posted a net profit loss of $ 4.6 billion in 2020 amid the COVID-19 pandemic. The year before, he lost $ 149 million.
In 2021, retail traders in Reddit’s Wall Street Bets forum invested in AMC stocks, pushing it higher alongside other meme stocks like GameStop and BlackBerry. Shares climbed more than 800% in January.
In its press release on Friday, the company said: “At last count, AMC had more than 3 million individual shareholders, with no entity holding more than a 10% stake.”
Redditors applauded the opportunity to buy more shares of the theater operator.
“We now own the future of this company!” one Redditor proclaimed, while another noted the opportunity to buy in the stock as a result of the sale by the Dalian Wanda Group. Others on Reddit posted rocket emojis, a reference to the hope the stocks “will go to the moon.”
“Short” and “squeeze” were two of the most frequently mentioned words about AMC on Reddit, according to Hype Equity data.
Retail traders have been known to wrestle with short sellers, most famously during the GameStop savage crisis earlier this year, resulting in billions in losses on some hedge funds.
The shares officially held by Wanda Group were sold on the open market to “a wide range of buyers on the New York Stock Exchange,” AMC said in its statement.
Earlier last week, AMC had its longest positive period in years as positive sentiment around the stock intensified and #AMCSqueeze evolved on Twitter.
AMC’s share was trading at $ 13.47 at 1:07 p.m. ET on Monday, up about 11.5%.