Shares of AMC Entertainment Holdings (NYSE:AMC) were up as much as 14.9% on Monday as more good news about COVID-19 vaccines came out. At the close of the market, shares were up 13.3% for the day.
AstraZeneca was the latest company to release data showing that its COVID-19 vaccine is highly effective. This follows Pfizer and Moderna announcing data in the last few weeks. On top of that, the government's Operation Warp Speed recently said that it could start administering the vaccine to people as early as Dec. 11.
Why is vaccine news driving a movie theater stock higher? Consumer discretionary stocks like theaters have been hit hard by COVID-19, so a vaccine brings some hope that business will get back to normal sometime in 2021. For today, that news alone is enough to push a stock like AMC's higher.
The reality is that the theater business may not come back like investors think next year. Movie producers have found new ways to distribute content to consumers, and more people than ever are streaming content at home. Traders may be pumping up AMC's stock today, but this isn't news I would buy, because the theater business may not ever go back to the way it was.