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An expert commentary on AMC Entertainment Holdings Inc (NYSE:AMC) and the future of movie theaters as AMC shares took a 40% haircut on Monday, on word that its biggest competitor – Cineworld Group (LON:CINE) – planned to file for bankruptcy.
The impact of AMC’s stock drop on movie theaters
Scott Sheridan, market expert and CEO of tasty works , comments:
“I think when the pandemic hit, a lot of industries adapted, and the movie industry was one of them. Delivering movies directly to consumers, either via streaming or through online stores for purchase/rental, has kept the industry moving forward.
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I think movie chains need to rethink the experience if they want to bring people back to pre-pandemic levels. With the cost of larger screen TVs falling and the expense of going to the movies so high, there isn’t as much of a compelling reason to go to the movies. While I don’t think the industry is dead, I do think it faces a daunting challenge.
We’ve only seen a few exclusive releases from big names in theater since Covid hit, and for the most part I think they’ve done just fine. I’m sure there’s still a population of would-be moviegoers who are reluctant to be part of large groups. But let’s see what happens as we get closer to big name vacations and releases.
As for AMC shares, they have been volatile lately, but it could be interesting, especially if you are an options trader. Right now, the AMC’s implied volatility is above 180% and the market is looking for an expected move of around $8 in the next 60 days.
About tasty labors
tastyworks is an online brokerage platform specially designed for options traders. The promising online broker is a subsidiary of tastytrade, one of the fastest growing online financial networks in the world.
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