AMC's Technical and Fundamental Analysis Point to Potential Weakness, Sell Recommendation

Company Overview

AMC Entertainment Holdings, Inc. (AMC) is a publicly traded company listed on the NYSE. The company has an average trading volume of 27.31 million, with the last trading day on August 16, 2023, showing a volume of 56.17 million. The company has a market cap of $3.24 billion, with 863.31 million shares outstanding.

Technical Analysis

AMC's last close price was $3.75, marking an increase of 1.90% from the previous day. It showed a high of $3.84 and a low of $3.47 on the same day. The 50-day moving average is at $4.58, while the 200-day moving average stands at $5.29. The relative strength index (RSI14) value of 40 indicates a neutral position, signifying neither overbought nor oversold conditions.

The Moving Average Convergence Divergence (MACD) is calculated as 0.20, suggesting a bullish trend, while the Average True Range (ATR) is marked as 12.14 signifying the high volatility of the shares. The company has a support level at $3.68 and a resistance level at $4.4. The year high for AMC is $25.45, whereas the year low stands at $3.18.

Fundamental Analysis

AMC currently displays a negative earnings per share (EPS) of -$0.67, with a price-to-earnings (PE) ratio of -5.6. However, a significant highlight is the discounted cash flow (DCF) of $4.35, potentially hinting at undervaluation.

The company is also set to announce its earnings on November 6, 2023. AMC has variously been rated as a strong buy (1), buy (2), hold (1), and sell (3), with the prevailing consensus erring on a "sell" rating. The median stock target is $2.00, with a consensus target of $2.67, a target low of $1.00, and a target high of $5.00.

Relevant News and Events

From a news perspective, AMC is facing a new class-action lawsuit over its APE conversion. Shareholders allege that the approved conversion is shortchanging the APE shareholders, which could potentially impact the stock negatively. Additionally, the Delaware Chancery Court's approval for the company's stock-conversion plan has led to an 8.4% rally, following a 35% plunge. The court's decision to allow AMC to convert preferred equity units into common stock has raised concerns over structural issues and lack of growth within the movie theatre industry.

Price Prediction and Final Verdict

Based on the current performance indicators, we could expect volatility in AMC's near future. The overall technical and fundamental analysis, coupled with ongoing events, suggest a potential weakening in stock prices. On the next trading day, the price could fluctuate around the support level of $3.68 and face resistance at $4.4.

Taking all these factors into consideration, and the consensus indicator predominantly leaning towards "sell," the final verdict for AMC is to Sell. However, the high level of volatility in this stock indicates that investors should tread carefully. Indicators suggest continued price fluctuations in the coming week.