amc penny stocks dumpster fire

One of the most popular penny stocks in the stock market today took flight on Tuesday. Shares of AMC Entertainment (NYSE: AMC) surged during the lunch hour thanks to unconfirmed reports that Amazon (NASDAQ: AMZN) could be looking to buy the “distressed asset.”

I will let you arrive at your own conclusions. Whatever your current opinion is, the story turned the heads of financial “pundits,” including FOX Business Network (FBN) Senior Correspondent and NY Post columnist Charles Gasparino.

In a Tweet on Tuesday, Gasparino said, “Looks like ⁦@amazon likes $AMC as a distressed asset via ⁦@JoeBelBruno —⁩ Amazon Considers Buying Distressed AMC Theater Chain in Seismic Hollywood Streaming Shift.”

He further highlighted the news that his Tweet was a source of the penny stock’s hype on Fintwit.

“For the record, I know a lot about the @AMCTheatres – @amazon story. From what I know the sourcing is solid. But what is being overlooked is that @amazon appears to be interested in $AMC as a distressed asset, not something to buy at a premium to share price.”


AMC Stock: Is The Hype Real?

According to the report in its own words:

“Amazon founder Jeff Bezos has dispatched his investment advisors and top entertainment chiefs to explore acquisition plans for embattled theater chain AMC Entertainment, according to multiple senior sources familiar with the discussions.”

It also discusses “discussions inside Amazon’s headquarters in Seattle and entertainment offices in Los Angeles are fluid.” Accordingly, its unclear as to the sources of this information. The report cites “one analyst” for a “major investment bank” in stating that AMC is a “distressed asset.”


Furthermore, the article highlights Jeff Bezos as the source of decision-making for the deal. While these claims have yet to be confirmed, some wonder why Amazon CEO Andy Jassy or other members of the C-suite were not necessarily mentioned. Does Amazon want to use AMC’s theaters as “marketing weigh stations,” as the “one Amazon insider” allegedly said? That is yet to be seen. Regardless, the hype is in play in the stock market today. AMC stock has exploded over 15% during the Tuesday session.

Aside from the Tweetshow that helped send AMC stock higher, earlier tweets from Mr. Gasparino may show a different outlook. In a Tweet from 3 hours earlier, he said, “My daily reminder that the worst trade of the past two years–that $AMC would MOASS to $1000 from its high of $70–continues to crash as the stock languishes yet another day below $5. Big thanks to the Ape community for reminding me to remind you. Sad Ha!”

Is The “Amazon to Buy AMC Entertainment” Real?

Whether you’re trading penny stocks or higher-priced stocks, risk is always a factor. How you handle it will dictate your success as a trader. Is this AMZN and AMC stock news real? That is yet to be seen. As of this article, no comments have been made to confirm or deny the accuracy of the speculation.

Nevertheless, when it comes to day trading, catalysts can come from multiple sources. Rumors are one of them and clearly, we see how that can lead to mounting speculative trading action. The most recent update from the company discussed results from the Special Meeting of Stockholders earlier this month. Shareholders approved a share increase with 88% in favor. They also approved a reverse stock split

Adam Aron, AMC Entertainment Chairman and CEO said, “AMC’s shareholders exercised their rights today to have their voices be heard. They voted resoundingly in favor of proposals that we believe are crucial to AMC’s future…If implemented, AMC should have an ability to raise a significant amount of equity capital in the months and years ahead. Winning these shareholder votes by such a lopsided margin is a powerful vote of confidence to allow AMC to raise equity capital, reduce debt, strengthen our balance sheet and continue our transformation.”

While there was no vote on a potential deal with Amazon, AMC stock has experienced its first resoundingly green session in weeks. The meme stock had slumped since reporting its last round of earnings in February as it just announced the launch of its microwave popcorn product at Walmart (NYSE: WMT).

NO DEAL Between AMC and AMZN?

In a final stint of stock market confusion, the original Fox Business pundit, Gasparino said:

BREAKING:@FoxBusiness has confirmed @amazon has long considered a possible purchase of @AMCTheatres and for various reasons hasn’t pulled the trigger. Its interest now remains though more as buying a distressed asset. There is NO deal on the table, I am told, and may never be”

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