AMC Entertainment (AMC) stock has been volatile in 2021. The retail traders on Reddit’s WallStreetBets forum sent AMC stock to more than $72 on June 2 by trying to squeeze the short-sellers. Since then, it has dropped significantly from that peak. Will AMC stock recover and go up this week?
AMC stock has gained 1,644 percent YTD. Investors are betting on a short squeeze and a recovery in the business with the lifting of COVID-19 lockdown restrictions.
AMC stock is dropping.
AMC stock has dropped 36 percent in the past month and has pulled back 49 percent from its peak. The rally in AMC stock was speculative and fueled by retail investors on Reddit’s WallStreetBets community. Usually, such short squeeze-driven rallies fizzle out as momentum among retail investors loses ground. AMC stock also fell after short-seller Iceberg Research said that it was betting against the movie theater chain operator’s stock. AMC scrapped a shareholder approval request to sell another 25 million shares.
AMC’s stock price prediction is bearish in 2021.
According to MarketBeat, analysts' consensus target price for AMC stock is $5.20, which is 86 percent below its current price. Among the six analysts tracking AMC, three recommend a hold and three recommend a sell. None of the analysts recommend a buy. Their highest target price of $16 is 57 percent below the stock's current price, while their lowest target of $1 is 97 percent below.
Will the apes win?
The retail investors on Reddit are collectively referred to as “apes.” Things have started to improve for the AMC apes. Some of the most bullish apes think that AMC's minimum target price is a whopping $100,000 per share. The fall in AMC’s stock price has Redditors pushing each other to buy the dip.
AMC apes have several reasons to be happy from positive business developments to ongoing ape community engagement. Most of AMC’s locations are open now and the continued COVID-19 vaccine rollout should help. What’s positive is the fact that pent-up demand is beginning to show. The company just claimed that it had broken yet another attendance record since reopening.
Major films are set to be released in the near future, which could benefit the company. AMC plans to buy two Los Angeles movie theatres that were forced to close amid the epidemic.
AMC stock short squeeze
AMC stock is still one of the most-mentioned stocks on Reddit. The stock is rumored to be ready for a short squeeze because of a high short interest ratio of 15 percent.
Will AMC stock go up this week?
AMC stock is up about 3 percent in the premarket trading session on July 26. If apes can get their act together this week, the high volume of bearish bets looks good enough to trigger a short squeeze in AMC stock. It’s difficult to predict how high AMC stock can rise in the short term since the share price is driven by investor sentiments.