AMC Options Surge on Strong Earnings and "The Odyssey" Box Office Success
AMC shares climb nearly 150% over four months, driven by record film performance and an earnings beat, though still far from 2021 highs.
نظرة سريعة
- AMC Entertainment saw its options surge with over 300,000 contracts traded and bullish flows after reporting earnings that beat expectations and double-digit revenue growth.
- The success of "The Odyssey" at the box office, attracting 4.3 million guests globally, contributed to a nearly four-month-long stock rally, despite shares remaining 99% down from their 2021 peak.
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لماذا يهم
AMC has been a prominent "meme stock" since the Covid-19 pandemic, experiencing extreme volatility, including an all-time high above $700 in 2021.
Asymmetric warfare. A long absence. Fierce loyalty. Of course, while many associate these themes with Christopher Nolan's "The Odyssey," it could also aptly apply to the never-ending saga that is AMC and the army of "ape" traders.
AMC options surged out of the gate this morning with over 300,000 contracts traded as of writing, almost five times the 30-day average and a top 20 stock in the entire market by options volume. Flows were very bullish, with almost 100,000 calls bought, compared to 62,000 calls sold and under 10,000 puts bought, following the film record box office.
In addition to "The Odyssey" breaking records, AMC reported earnings today that beat analysts' expectations and showed double-digit revenue growth.
"America's fascinated with The Odyssey this weekend," AMC CEO Adam Aron said on CNBC's "Squawk Box" this morning. AMC theatres received 4.3 million guests globally across the weekend, Aron added.
Monday's rally adds to an almost four-month-long climb in AMC shares to just under 150%. That said, for bulls who've been in the stock since its heyday as a retail "meme" favorite after Covid, it's far from a coming-home party. Shares are still down 99% from its all-time high above $700 in 2021. Of course, the options market played a key role in the meme stock mania, often leading underlying shares of AMC.
More than $6 million in options premium exchanged hands Monday, with $5.5 million tied to call contracts.
The most popular options contracts by dollar amount were the 2 and 2.5-strike calls expiring Aug. 21, which were on offer for 39- and 20 cents, respectively. The most popular trade by volume was the 3-strike call with the same expiry, which needs a 34% rally to break even.
Traders willing to spend more on premium may want to watch Imax, up 37% the past year with call options showing some life today, but not nearly as busy as AMC trading.
"As a result of Covid there was a lot of experimentation but what Hollywood has learned over the last several years is people love to go to movie theaters," Aron said in the interview. "Studio after studio is turning out movie after movie designed for the big screen."
أسئلة مفتوحة
- Will the current stock rally be sustained?
- How will future film releases impact AMC's long-term recovery?
