On June 2, AMC Entertainment Holdings Inc. announced it will offer a free large popcorn to investors in its shares the first time they attend a movie in an AMC theater this summer. This is wonderful on two levels. First, because it may be the only thing of actual value that the shareholders ever receive for their money. And second, because popcorn is the perfect metaphor for AMC shares, as I will explain below at some length (ahem).
Bloomberg reporters have been all over the story of AMC’s soaring stock price, which, as of a one-day gain of 95% on June 2, made the company more valuable than Delta Air Lines Inc. (not to mention higher-flying). They’ve pointed out that analysts expect the company to lose $100 million over the next 12 months in earnings before interest, taxes, depreciation, and amortization. They’ve noted that AMC has negative shareholder equity—not just small; negative—and cited analysts such as Mark Levin of Asterisk Advisors, who wrote, “It is clear that fundamentals don’t support common stock levels at all (which makes sense for the Reddit crowd).”