The AMC stock price jumped more than 7% earlier on Monday. AMC is the world’s largest movie theater chain and has the largest share of the US theater. Its total market capitalization currently stands at £18.35 billion.
The resurgence of the coronavirus underpinned by the Delta variant saw cinema chains shut down in a bid to curb the virus spread. However, with the easing of lockdown restrictions, most cinema chains have been struggling to recover, albeit at a slower pace.
The AMC share price has jumped more than 11% and more than 22% since the start of August. In July, AMC reported better than expected results in the second quarter. The company reported a quarterly loss of $0.73, beating analysts’ consensus estimate of a loss of $0.93. AMC also reported quarterly sales of $444.7 million, which surpassed the consensus estimate of $375.3 million.
More notably, AMC reported that its available liquidity is more than over $2 billion. AMC CEO Adam Aron commented, “We raised yet another $1.25 billion of new equity capital (before commissions and fees) in the quarter, boosting our quarter-ending liquidity to more than $2 billion.”
Uncertainty over the covid-19 virus is still hovering among investors. However, Adam Aron seems optimistic about the company’s share price.
The four-hour chart indicates that the AMC share price has been struggling to recover. The stock hit an intraday low of $34.40 before bouncing back to $37.00.
It is trading slightly above the 50-day moving average and below the 200-day moving average. The stock has found support along the 50-day exponential moving average.
Therefore, the company’s share price is likely to face a minor pullback in the next few weeks before bouncing back. If this happens, the next suitable target will be the resistance at the 200 DMA at $43.45. However, a move below the support at $30.00 will invalidate this view.