![]() īret Kenwell is the manager and author of Future Blue Chips and is on Twitter. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines. On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. In short, the bulls essentially need momentum to continue because the fundamentals just don’t justify the stock price. That’s high, but not so high that we have any sort of short-squeeze guarantees to lean on. There is a rough estimate for AMC’s short interest likely sitting between 17% and 19%. And it may even help trigger the type of meme squeeze we’re looking for. That said, a stronger-than-expected quarter and a better-than-expected outlook would go a long, long way in resolving some of these concerns. ![]() So investors really are not chasing value at these prices, they are chasing a narrative. We failed to mention that analysts expect AMC to lose almost $3 per share this year and another 74 cents per share in 2022. Lastly, keep this in mind: Until 2021, AMC stock rarely traded with a price-sales (P/S) ratio of 0.5. It churned out revenue of $5.08 billion, $5.46 billion and $5.47 billion in 2017, 20, respectively. There’s also the consideration that - again pre-Covid - AMC couldn’t generate meaningful growth. So even after back-to-back years of strong growth (and even when we account for above-consensus results), AMC still isn’t achieving pre-Covid revenue results. While we’re talking about some big-time growth estimates, realize that AMC did $5.47 billion in sales in 2019. Compare that to analysts’ current expectations of $4.55 billion in sales, and it is actually closer to the current 2023 consensus estimate of $5.2 billion in revenue.Įven in that very rosy scenario, we’re still talking about a major jump from 2022 revenue. That gets us to $4.96 billion in revenue for year-end 2022. Let’s round up to 100% growth for both years. That’s roughly nine times this year’s current revenue forecasts of $2.4 billion.Īnalysts are certainly bullish, expecting about 90% growth this year and next year. The company’s current stock price translates to a market capitalization of more than $22 billion. Why? Because technically the growth doesn’t really justify’s AMC’s valuation. ![]() In turn, the report very well could be the deciding factor in whether we get a meme squeeze in AMC stock before 2022. Will Earnings Trigger the Squeeze?ĪMC Entertainment is due to report Q3 earnings after the close on Monday. On the downside, though, a move below $33.75 opens the door to the 200-day moving average and the key $30 level. Above that, and we could be talking about a possible meme squeeze. That will put the September high near $53 on the table, followed by the 61.8% retracement near $56 and the third-quarter high at $57.71. If we can get a push through this mark in the next few weeks, it will give us a monthly-up rotation. This area marks the high for both October and November. What bulls want to see now is a push through $44.50. It has been stymied by downtrend resistance (blue line), but the stock was finally able to close over this measure on Friday, Nov. Well, AMC stock is trying to do just that. With that in mind, could we finally see a break out of the wedge? This time, though, shares double-bottomed near $33.75 - a higher low vs. Shares topped near $53, put in a doji candle for the day (suggesting some indecision among investors) and promptly reversed lower. With a nice double-bottom low to measure against (around $30), AMC went on a powerful run. And while AMC stock was able to hold up over the $50 level for awhile, it eventually broke down and dropped to roughly $30. The share price exploded from sub-$10 to more than $70 in just a few weeks. That’s a type of consolidation, and given AMC’s rally in the second quarter, consolidation is exactly what the doctor ordered. Shares of AMC stock are putting in a series of higher lows and lower highs, giving us a wedge formation.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |