What happened
The long Memorial Day weekend did nothing to boost the shares of AMC Entertainment Holdings (AMC +8.74%), despite the top-flight performance of the Tom Cruise-led Top Gun: Maverick. While theaters were overwhelmed by the box office hit, which took in a record $156 million for the three-day holiday weekend, AMC's stock fell on Tuesday and is still falling today.
Shares of the movie theater operator were down 6.1% at 10:41 a.m. ET on Wednesday, after failing to hold on to the initial burst higher it enjoyed on Tuesday on the stellar box-office numbers.
Image source: Getty Images.
So what
You would think the start of the summer movie blockbuster season would benefit AMC. After Top Gun, the next in the Jurassic Park franchise will arrive next week followed by the Toy Story spinoff Lightyear the week after. In July, the next installment of Marvel's Thor superhero series is due.
It's what AMC investors have been anticipating beyond just the arrival of the "mother of all short squeezes." And yet, the beginning of the summer run was met with at best a collective yawn by the market, which should be a worrisome development.
Now what
Because AMC Entertainment has become the premier meme stock, it no longer trades on the value of its business or its fundamentals, but rather how much internet and social media chatter it can generate.
Although a record-breaking holiday weekend ought to have tongues wagging, the comments are just as likely to be pointing out that the theater business is decidedly not yet back to pre-pandemic levels, and it could be a long slog for movie theaters to hit those numbers -- if ever.
