AMC’s Share Price Falls from its Meme Glory Days
AMC shares are currently trading at $6.70, a dramatic fall from their high of $393.63 during the meme-stock frenzy in June 2021. Reese explains that the current premium valuation of AMC is driven, in part, by a sub-section of loyal shareholders who gained their stake during the meme stage and have claimed to be AMC shareholders for life.
Looking into the future, Reese predicts that AMC will continue issuing pre-authorized shares to pay down its high-debt balance. This week, the company completed a $350 million equity offering as part of its effort to right-size the balance sheet and maintain ties with the devoted AMC lifers supporting the stock.
GameStop Faces Challenges as a Declining Business
GameStop, another original meme stock, has also made recent headlines. The company’s board of directors has approved a new investment policy that allows GameStop to invest in equity securities and other investment options.
However, the analyst sees GameStop as a declining business, as evidenced by its third-quarter revenue decline from $1.186 billion to $1.078 billion year-over-year. The declining trend suggests that GameStop cannot save its way to prosperity and faces significant challenges.
The implementation of GameStop’s new investment policy may generate more meme-style activity in the future, drawing close attention to the company’s moves.
Retail traders remain on the lookout for high-volatility situations in the market. Bruni highlights Vietnamese electric vehicle stock VinFast Auto Ltd. (VFS) as an example of a stock that experienced a “crazy month” in August before crashing back down. However, there have been fewer instances of these meme stocks this year, and their lifespan tends to be short-lived.
Various sectors, such as electric vehicle startups, solar stocks, and China-related stocks, have gained attention as potential meme stock candidates. For example, Lucid Group Inc. (LCID) has seen a 28.6% increase in 2023, outpacing the S&P 500 index’s gain of 22.9%.
Crypto meme communities are also emerging, with examples like $BONK, a dog-themed coin on the Solana blockchain, already capturing the attention of enthusiasts.