A $ 230 million equity injection gave a boost to shares in AMC Entertainment (NYSE:AMC) this morning. AMC stock was up nearly 12% as of 7:15 a.m. EST.
This injection comes from Mudrick Capital Management, which purchases 8.5 million Class A common shares of AMC at a price of approximately $ 27.12 per share, according to a AMC press release.
AMC stock closed at 26.12 per share on Friday after hitting a four-year high a day earlier. The memes stock has done quite a bit this year, catapulting 1.132% so far this year as the S&P 500 gained 11.9%.
Moviegoers should benefit from the new money, as AMC said the proceeds from the sale would be used to acquire additional movie leases, as well as investments to improve the consumer appeal of AMC’s existing theaters. . “In addition, with these funds in hand, AMC intends to continue to explore debt reduction opportunities,” the company statement said.
AMC Stock Looks Set To Continue Earning Memes
The meme frenzy that has brought fortunes to many retail investors this year shows little sign of abating as Americans exit pandemic lockdowns and head into summer. Security software vendor actions Blackberry (NYSE:BB), grew 7.9% pre-market, while the video game retailer GameStop (NYSE:GME) was trading 4.27% higher.
AMC stocks and GME stocks are the first choice for buyers on the Robin Hood application, Reuters reported. Almost 96% of posts on Stocktwits related to AMC presented a positive sentiment towards the title this morning, the news agency said.
Investor place Contributor Joseph Nograles felt last week that trading memes has never been a strategy that works for the long term. However, “there are strong bullish arguments to be made for AMC stock as a reopening game,” he advised.
He noted that with its position as the largest theater operator in the United States, AMC is well positioned to take advantage of these macroeconomic tailwinds.
Now, management has an additional $ 230 million in cash to use in this lawsuit.
As of the publication date, Robert Lakin does not have (directly or indirectly) any position in any of the stocks mentioned in this article. The opinions expressed in this article are those of the author, subject to the publication guidelines of InvestorPlace.com.
InvestorPlace contributor Robert Lakin is a seasoned finance writer and editor, who has worked for Bloomberg News and as the editor of Buy Stock Research, among others.