Shares in cinema chain AMC nearly doubled yesterday, extending a strong rally and marking a potential return to the meme stock craze that roiled markets earlier this year.
The cinema group’s shares closed up 95 per cent at $62.55 — a new record high. Its market value is now more than $28bn, more than Viacom CBS and Kellogg, as well as fellow meme stock GameStop.
AMC is one of a number of so-called meme stocks that rallied sharply earlier this year after retail investors on Reddit forums such as Wall Street Bets pumped money into the shares.
In an apparent nod to these armchair traders, AMC chief executive Adam Aron yesterday offered a free large popcorn to even the smallest investor if they signed up to a regular newsletter.
The latest surge builds on a huge rally for the cinema chain, which has seen its share price rise about 2,850 per cent from just over $2 at the end of last year.
“On the face of it, a pile on for free popcorn appears to be partly behind the surge, with the sugar coating of a fresh social media storm around the stock,” said Susannah Streeter at Hargreaves Lansdown.
“But the swell under the share price has been gathering for some weeks as investors searched out re-opening stocks which could benefit from the easing of social restrictions. Add into the mix strong takings for cinemas over the weekend and a possible loss of appetite for crypto investments following recent falls, and the swirl of interest has intensified.”
Other analysts drew comparisons with GameStop, which rose more than 1,600 per cent in January, spurred on in part by a major short squeeze as bearish investors unwound their bets.
Fellow meme stocks Blackberry and headphone maker Koss Corp rose 31.1 per cent and 68.6 per cent respectively.
“It’s meme stock 2.0.,” said Steve Sosnick, chief strategist at Interactive Brokers.