Wedbush analyst alicia reese says amc entertainment holdings' heavy debt load and ongoing stock issuance will keep its share price volatile, even as the company works to reduce debt.
AMC Entertainment Holdings (NYSE:AMC) share price is expected to stay volatile, with more share sales predicted as the ‘meme-stock’ cinema operator works to reduce its debt pile, so say analysts at Wedbush.
AMC has repaid $1 billion but its outstanding debt still stands at $4.4 billion.
Wedbush analyst Alicia Reese sees the “heavy” debt load as a drag on the stock, especially as the firm has been selling new stock into investors.
As such, she expect shares of AMC to remain volatile, with potential future price boosts from in the market offset by further share issues.
Nevertheless, Reese sees potential for AMC to capture a larger market share.
Meanwhile, she said industry trends show that year-on-year comparatives will be challenging, with some recent box office titles underperforming. But, Reese anticipates a notable rebound in the summer box office against difficult comparisons until September.
"We expect the summer box office to rebound notably from the year’s first half, albeit against difficult comparisons until September," she said.
