AMC Share Price
The AMC share price (NYSE:AMC) moved up by a staggering 22% on Tuesday to $31.90 per share.
As a result, Mudrick Capital Management, the hedge fund run by Jason Mudrick, pocketed a sizeable profit by buying and quickly selling a position in the cinema chain, in a move that appears to be out of the book of the Reddit investors.
Mudrick Capital Management
Mudrick’s move appears to be something of a change of tack by institutional investors in the market. The hedge fund was ready and willing to move in to exploit the bull run started by armies of online retail traders.
The cinema chain has recently been propped up, along with GameStop, by the attention of investors influenced by the WallStreetBets Reddit forum.
The AMC share price is now up by more than 1,400% year-to-date on the back of speculative Reddit traders.
Mudrick’s play came as vaccinated film fans are now allowed to attend cinemas without masks. Over the weekend, A Quiet Place Part II became the biggest US box office hit since the beginning of the pandemic.
It is welcomed news for an industry which suffered heavily during lockdowns.
AMC confirmed its intention of putting proceeds from the sales of its stocks towards acquisitions in the future.
AMC chief executive Adam Aron said in a filing that the cinema chain is on the front foot as the vaccine roll-out continues and “blockbuster new movie titles” are on the way.
An analyst from Loop Capital told FX Empire that the current AMC share price “does not reflect fundamental value” and reaffirmed a sell rating.