What happened
Shares of AMC Entertainment Holdings (AMC -2.01%) have barely had time to take a breath from their stunning fall from grace as the movie theater operator sees its shares down another 6.9% at 11:39 a.m. ET on Thursday.
As usual, there is no specific news to account for the drubbing the stock is taking. After soaring as high as $34.33 a share at the end of March, AMC has lost 57% of its value. It's lost 80% of its value from its meme stock trading frenzy high of over $72 a share.
Image source: Getty Images.
So what
AMC stock is heavily shorted with over a quarter of its shares sold short, and other than the short squeeze its self-described "apes" keep hoping for, there's little to suggest the theater owner's stock is going to go higher.
Theater attendance remains down and the economy is worsening with gross domestic product falling 1.4% in the first quarter compared to a 1% gain expected. While people might consider going to the cinema for a bit of escapism, inflation is running rampant and real disposable income fell 2% for the first three months of the year. Personal savings is down, too.
There's less money available for people to spend and everything costs more, making a pricy movie ticket a luxury item these days.
Now what
AMC Entertainment is already facing a daunting recovery, but an economy caught in the vise of stagflation makes it that much harder and the chances for the movie theater stock's reversal grow longer.
