After Monday’s closing bell, AMC Entertainment Holdings Inc. will announce its results for the third quarter of 2021 and the majority of its shareholders will applaud the outcome regardless of…the outcome.
status as an OG top-tier meme stock has been fully cemented in the last few months, with retail investors appearing more committed than ever to keeping the company’s stock nice and high thanks to the actual business reality of a movie theater chain benefiting from people going back to the movies after a pandemic, and the company’s CEO Adam Aron becoming an unabashed courtier of the “Apes” that control his float.
With a string of delayed blockbusters hitting theaters going into the historically strong holiday movie season, AMC has released multiple statements touting box office numbers that look like pre-pandemic returns, a signal that the third quarter should be a stronger one than AMC has seen in a while.
But even if the numbers disappoint, AMC’s after-hours trading will look like a shrug emoji, because a whole bunch of AMC’s stock is held by true believers who will follow Aron anywhere at this point.
And Aron has led them.
As we have discussed ad nauseam in this column, Aron’s showman embrace of social media to interact directly with his Ape base has been unmatched in the meme stock space, and he has deftly wielded that trust/power to get AMC out of a deep, deep hole of debt while also proselytizing about popcorn.
AMC stock was up nearly 7% Monday afternoon as the faithful began to literally buy into the earnings, and there is very little reason to think that the momentum will ebb going into the close.
Firstly, social media is awash with diamond-handed Apes psyching each other up for the results, and warning each other to get in on the FOMO, or fear of missing out.
One popular post on subreddit r/AMCStock claimed that exchange IEX had no available AMC shares by late morning on Monday
“I spent 25 minutes on the phone with a Fidelity rep…who advised that IEX does not have anymore shares of AMC,” wrote treeguy201. “My orders were immediately canceled (both Market & Limit). She advised me there are ~1000 callers in her call queue.”
On Twitter, the vibe was less wonky:
But diamond hands might not even be needed.
If social media is to be believed, AMC shares are among the most popular with retail investors devoted to the direct registration movement, a tactic that Apes have embraced allowing them to hold stock in a company directly rather than through the more common ‘street’ ownership, keeping short sellers from being able to borrow them.
Direct registration also makes it harder for investors to sell their shares quickly, but AMC’s earnings have not dampened interest in retail investors giving their shares to transfer agents to hold.
“We are continuing to see higher than usual volumes to register transfers onto our DRS platform, in particular from a couple of so-called ‘meme-stocks,’” said Paul Conn, president of Global Capital Markets at Computershare
a popular transfer agent for retail investors.
Even the arguments against AMC are based on its incredible strength among its base.
Wedbush analyst Michael Pachter downgraded shares of AMC on Thursday to “underperform” and based his case on the “assumption that ultimately the majority of retail ownership will eventually cash out and move on.”
But even Pachter cautioned in his note that “Volatility in shares of AMC is likely to continue, driven by trading momentum unrelated to AMC’s fundamentals by retail investors whose time horizons remain unclear.”
One thing that is clear is that Monday’s earnings are not a horizon, just another big moment in what has been a wild year for AMC and its Apes.