AMC Short Squeeze Price: Expectations VS Reality

AMC Short Squeeze Price Potential
AMC Short Squeeze Price Potential

Retail investors often wonder how high AMC’s short squeeze price potential could be.

We heard many numbers get thrown out there earlier this year.

They ranged from $1,000 to $10,000 and even $100,000 and $500,000 per share.

What exactly are we dealing with here?

And, could AMC’s short squeeze price even be higher?

franknez.com

Welcome to Franknez.com – the blog that fights for retail investors. Today we’re going over AMC’s short squeeze price potential.

Let’s get started!

Measuring AMC’s Market Cap For Squeeze Potential

AMC’s current market cap is approximately $21.86b with a share price of $42.60 (11.16).

Volkswagen short squeeze chart

When Volkswagen’s short squeeze price reached 1005 euros, the market cap was worth $296b euros, or $370b dollars, via Reuters.

Let’s calculate AMC’s share price at a $370b dollar market cap just for comparison.

$370b market cap ÷ 513.145 million outstanding shares = $721.04 per share.

AMC’s market cap would have to be almost 17x more than it’s current market cap.

Now, keep in mind synthetics/naked shares aren’t being calculated and I’ll get more into this later.

Is this market cap possible? Absolutely.

Here are a few companies with similar market caps:

  • Walmart $399.23b
  • Procter & Gamble $356.192b
  • Nestle $366.725b
  • Mastercard $363.114b
  • Johnson & Johnson $428.245b

AMC’s market cap was worth $300m (Nov. 2020) -$500m (Jan. 14, 2021) earlier this year, via CompaniesMarketCap.

That’s a 72x market cap growth in a year; making a 17x market cap surge up to $721.04 per share rather feasible.

Community, a move up to the high hundreds seems fundamental to me.

Especially considering big shorts have not covered.

Short Interest

There’s not much data that ties AMC’s current share price to short covering.

We’ve seen AMC’s short interest come down 3.7% to its current 16.27% from a peak of 20% in the span of 5 months.

We’ve also seen AMC’s share price trade between the low $30s to low $40s.

One could argue that this small drop in short interest could be due to very small short covering, thus bringing the share price back up to $40 from the $30 level.

We’ve been trading sideways for quite some time now.

What’s to say the $30 level isn’t being used to cover small positions, driving the share price back up to $40; and rinse and repeat?

If that’s the play, hypothetically speaking, then the ones benefiting from apes holding are day traders and some shorts.

Buy VS Sell Ratio

If this is the case, we’ll need to start seeing more buying pressure and less selling.

AMC Buy vs Sell Ratio
AMC Buy VS Sell Ratio 11/15, via. FIDELITY

Otherwise, retail investors could be creating an escape route for short sellers and a playground for day traders.

This $40 range is reminding me of the $14 level Wanda Group wouldn’t let us get passed by.

Every time we would hit $14, the company would sell shares.

Only this time it seems it’s a combination of day traders selling high, short sellers shorting the stock, and some retail selling (non-apes).

This MOASS play is not for everyone.

But if more investors dedicated this play to squeezing shorts from their positions, then retail could certainly 17x AMC’s market cap up to the $700 per share price range just from momentum alone.

Short Squeeze Price With Synthetics Covered

There are many reasons to believe millions upon millions of synthetic shares have been used to short AMC stock.

Billions!

But we don’t have the support from anyone to confirm this to the point where it can be calculated.

Here we can come up with numbers based on estimations but I’m not here to do that for you.

Do I believe synthetics have been used to drive AMC’s share price down?

Absolutely.

Do I believe hedge funds will do the ‘right thing’ by covering these?

Off exchange markets allow hedge funds to swap stock back and forth behind the lit market.

Who’s going to regulate and ensure hedge funds cover these shares?

So until that happens, you can count a short squeeze price calculation with synthetics out for now.

But it’s for this exact reason why retail must fight for a fair market and for proper regulation.

Covering billions of synthetics could absolutely push AMC’s share price into the high thousands to even tens of thousands.

The problem here is we have no proper or legal documentation that allows us to accurately identify this scenario.

A proper MOASS would require proper regulation, forcing hedge funds to close all borrowed and naked shares.

How Do We Get A Proper Synthetic Share Count?

By requesting it from regulators.

I saw a poll on Twitter tagging Adam Aron whether management should look into answering shareholder’s question regarding synthetics in the market.

Adam Aron has turned the cheek in the past saying they have no knowledge of these synthetics.

However, we should be tagging regulators, not the CEO of AMC.

I just personally don’t think he can get involved.

But if he could, as a shareholder himself, it would greatly play in our favor.

Only time will tell how this unfolds.

Setting Realistic Expectations

So, we don’t have an exact count of synthetics.

What we do know is that AMC’s short squeeze price potential can be massive when looking at just how many synthetic shares could be out there.

But we also know this.

If AMC’s market cap grew by 72x from November 2020 to November 2021, then it can certainly grow another 17x (VW short squeeze market cap example); where the share price will trade above $700 per share.

This could be caused by heavy buying pressure from retail, whales, some short covering, and FOMO buyers.

Now you have to ask yourselves, how large will my portfolio be worth at $700 per share?

Just for perspective of course.

Do you have enough shares to be happy with the results?

Or will you continue to hold 5 shares waiting for this to hit +$100,000?

Bulls make money, bears make money, pigs get slaughtered.

There’s no telling how high or low AMC’s short interest will be around $700 per share.

If it’s still relatively high then it would simply mean there’s more room for growth.

However, if there’s a significant drop then it’s a sign plenty of shorts covered.

MOASS Will Require A Synthetic Share Count

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If AMC is to experience a proper MOASS, it’s imperative that regulators undergo a synthetic share count investigation.

I’m going to publish an article regarding this matter that we can pitch to regulators and get circulating out there.

ADVISORY:

Keep in mind I’m only using Volkswagen’s short squeeze market cap as an example to paint a possible scenario for AMC based on a 17x market cap from its current market cap.

These type of plays are rare and there’s not much information about them.

This means we’re paving the way.

I hope that this article provides you with a perspective that helps you identify just how high AMC’s share price can go in general.

Should we push regulators to investigate?

Of course.

Should we sit on our hands and just wait on regulators?

Hell no.

Identify how many shares you’d need to meet your goal, not counting synthetics for now, and ensure you can walk away with a significant amount of money when you’re ready to.

This play is continuously unfolding.

I would love nothing more than to create another article time from now calculating a confirmed synthetic share count for the community.

Final Words

franknez.com

I hope you found this article helpful in one way or another.

Again, I’m using information I have at hand.

I could calculate several scenarios with different market caps but the reality is there could be enough synthetics to take AMC to Pluto and into the several thousands to tens of thousands of dollars per share.

Whether culprits take accountability for these synthetics or not will be up to us to fight for.

With that being said, I’m going to be using my platform to voice tackling this synthetic share count problem.

We cannot let hedge funds get away with this so easily.

I’d love to hear your thoughts. Leave them in the comment section of the article below.

franknez.com

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Bookmark: List of Momentum Stocks: AMC short interest and utilization


20 Comments

  1. CLam

    Yes, I agree with you that we can’t sit idle to wait for the short squeeze to happen one day. We need to push regulators to investigate. Please publish the article & let us know what we need to do to move forward.
    Thanks for your activism!!

  2. Tim Finley

    We own the float many times over. Definition of a squeeze is infinite. Supply and demand kick in. Market cap has nothing to do with it when a squeeze is underway. Shorts have to buy back. If there’s none to buy. We pick our price to sell our shares to. All this other has no meaning to a squeeze.

  3. BILL

    Why do hedgefunds get use naked stocks/ synthetic shares to suppress the price of the stock and not have to pay for it actions. Where’s accountability

  4. Vivian

    Why?

  5. Alvin Rodriguez

    what do you think about what other are talking about AA to issue dividend tokens ???

    • Frank Nez

      I’m publishing an article on this matter today 🍿

  6. Jeremy Worobec

    I love this article!!! I’ve been diamond handing AMC since January and looking forward to the MOASS. Look at all the corrupt practices that have been exposed throughout the journey to this point. Hedge funds are screwed. Costs nothing to hold. Tick tock. The spring is compressing and ready to blow. I wish everyone the best of luck and life changing money once the smoke clears.

    • Frank Nez

      Been diamond handing this all year as well brother 🚀

  7. Alfredo Iznaga

    I like this proposition !!!!, it should be taken into account.

  8. Vivian K Hill

    We are all tired of waiting, but we cannot become complicit either. This will not happen by itself, we are going to have to make it happen. We need more unification and organization. The whales buy in large quantities. We need to do something similar. We need to try different things. Like choose a day for ALL APES to buy at least one AMC stock, so a large retail order will go thru. People usually get paid on the 15th and last day of the month, OR every 2 weeks. Those who can afford it can maybe all purchase one AMC stock twice a month in a coordinated way. All top Apes with youtubes and blog platforms need to get together to have a meeting on zoom and get a unified message out with dates.

    • Simon

      I think that would be illegal.

  9. DON REED

    Having all “Apes” order their broker to deliver their stock to them would be a good start

  10. Olaf

    60 percent darkpool trading for months with a lot of volume. If you do the math, there are at least 15.5 B synthetic shares that have to be covered. When they get margin called the price will sky rocket. When apes hold this could go to 100K at least.

    • Frank Nez

      🚀🚀🚀

  11. Vivian K Hill

    Maybe every ape should dedicate themselves to systematically buying 1 share every week or every month, if their pockets will allow for it.

  12. Jared Baine

    Is it possible for them to cover little by little until they’re out of this unscathed or no? And if so, how do we know they’re doing that?

    • Frank Nez

      It would take way too long. Momentum is needed to create a chain reaction.

    • Rojo Nicon

      Okay I wrote a really detailed reply as to why, yes, that could happen and how the more I learn about the market and momentum plays the more I fear we sat in the beaker too long and will be the frog that gets boiled one degree at a time.

      I got in late. I stand to lose money on this but not enough to hurt me. I think the community got so wide eyed that the definition of momentum got scuttled in favor of wide eyed projections of extreme wealth.

      Frank, you should also show the math based on the current market cap. Bc that suggests that when we hit $72 we peaked. At $42 ppl who joined late like me can still avoid losing our shirts (still a bummer) and the ppl like you can actually make some money. I only say this bc ppl have their whole financial lives in this. That’s nuts. I bet only an amount of money I could lose. That’s not a dig or anything – in another situation I might have done the same.

      Momentum plays are meant to happen fast and loud. They’re The Ramones not Rush.

      • Benedetto

        If you think that those with a pmc of around $ 40 or $ 50 entered too late, what do you think could be a target price for AMC? if, as you say, Frank $ 700 is too optimistic, do you believe in your personal opinion it can return above $ 70 or $ 80? I await your thought. thanks a lot!

    • Michael

      They are not covering until they buy “our”
      shares! They can not cover without them!

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