APE shares have fallen from $7 to the current $2 price.
AMC’s Preferred Equity reached 20.1 million in average volume but has been dropping by nearly half during this market downturn.
Shareholders remain bullish despite the company announcing the sell of up to 425 million shares of APE to pay down its debt.
But is APE merely a fundamental tool to push AMC in the right direction?
Or is it more than that?
Let’s discuss it below!
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APE and Synthetic AMC Shares
APE shares were distributed to AMC shareholder in August.
AMC shareholders received 1 APE share for every 1 AMC share they held.
The theory was that the issuance of APE would unveil synthetic shares in the market, and for a while, some shareholders actually didn’t receive their APE shares on time.
Come to find out, majority of these shareholders were using brokers outside the U.S. which delayed the delivery of the equity.
Adam Aron stated that although he didn’t have any knowledge of synthetic AMC shares, the issuance of these units should at best put the theory to rest.
But AMC’s Preferred Equity has not proven to be the catalyst retail investors hoped for, at least not for a short squeeze that is.
The markets are quite trickier than that, especially what occurs behind the scenes where much information is masked or hidden from the public and even the SEC.
Shareholder sentiment is strong, but many shareholders aren’t happy with the promised ‘pounce’ the CEO announced on Twitter.
A Tool for Retail Investors or AMC Entertainment?
Shareholders holding AMC’s Preferred Equity have suffered losses greater than what AMC stock alone could have.
While AMC stock is owned and decisions are primarily made by shareholders, APE is not.
APE grants AMC Entertainment with access to a large fraction of shareholder’s capital to use at any given moment whether it’s to pay down debt or other fundamental innovations.
For shareholders, purchasing APE shares would mean providing the company with liquidity, charity if you will.
But investing in a company can go two ways:
- You either invest in a company to make money (trade, cash dividends, etc.)
- Or you invest in a company you believe in, betting the value of the company will increase over time and cash out later
It’s important to identify these two types of investments when buying APE shares from AMC Entertainment.
AMC Entertainment has a gameplan and retail investor should too.
Will APE stock go up?
APE stock has the potential to go up, but it also has the potential to get delisted from the market, should it go to zero of course.
AMC released the following statement on APE stock:
“Under the circumstances, we caution you against investing in our AMC Preferred Equity Units, unless you are prepared to incur the risk of losing all or a substantial portion of your investment,” said an official statement from AMC Entertainment.
It’s fair to assess that APE is a tool from which AMC Entertainment can take full advantage of to give them the edge to rise up fundamentally.
The company just announced it is collaborating with Netflix to show its first ever Netflix movie in 200 AMC movie theatres.
While AMC shareholder might not be benefiting so much at the moment, the movie theatre chain sure is.
And as the markets begin to reverse, so will shareholders’ luck.
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Related: How High Can APE Stock Go?
About The Author
It’s a shame that we brought AMC back to life again. And if it wasn’t for us
The company wouldn’t of been able to buy into Disney, Netflix, a Gold mine etc; I feel used and then abandoned. I’m like most folks on here and I really thought I was investing in a company that I didn’t want to see taken over by all these greedy hedge funders. I know I’ll never be rich when it comes to money. But it would of been nice to be able to help my kids.
I’m not a quitter so I’m not going away. I’m here till I win or loose.
Thanks Guys and God bless.
Frank. I think you are missing a point. APE shares won’t go to $0. They are convertible 1 for 1 with AMC.
Never thought I would watch
APE,AMC and GME lose so much money and be unfazed. I know what I own. I know they have created Billions of synthetics. I know we are scaring the shit out of them doing exactly the opposite of what they thought we would do. We know how rigged and manipulated the stock market is. The reputation of the DTCC, SEC and Wall St is now in the sewers going down the pipe. I hope the authorities in the US think its been worth it, because I am not sure any of them will ever fully recover. We will still squeeze and they know it. This is being delayed to past the midterms. They are prepared to screw the whole market to achieve that goal.
It appears/APPEARS this did not work out ( APES ) for the company or us they way they expected. The company will walk away with a plus. Retailers not so much , before Apes we were hovering around 18 to 19. where are we now if you add the two. $8.48 … Yes the market is down and we would have got hit anyway. I am stuck in at the $45 range down
about $36,520 per thousand shares. I have a LOT more than 8,000 shares . I am STUCK !
Very hard to try to not let this eat my insides up, sleep , and not snap at everyone around me for no reason. But itswmy fault I bought all the BULLSHIT HYPE and went in way over my head. People don’t do that learn from me, DO NOT put more money in then you be alright with on the hopes down the very very long road it comes back. froma brother to our beautiful family and I still feel for the thousands of people who can’t afford to take this hit,.
I saw a lot of short Tik Tots on Lou VS, Wallstreet, he had the community send in shorts so we could see who were are family, seeing single fathers/and Moms in small rooms living with kids who took a chance in hopes of making just some money to live a little better KILLS me. These RICH COCKSUCKER hedge funds could care less and enjoy stepping on us retail traders , It kills me as a human being, I came from nothing , and fought my way out of a hole , and NOW to give my money to them . NOT !. We will prevail in time . Believe and TRY to stay postitive , negativity just brings everyone down around you.
We are with you brother! They cant keep kicking the can forever. The market makers are selling us synthetics. Our buys are diluting the stock. We buy IOU’s, they don’t locate these shares, they then turn into FTD’s and they have found an illegal way to cover them without effecting the price. It’s a criminal operation. They won’t win by cheating!
💯💯💯
Brian, Thank you ! You are 100% right, and it does make sense they are holding off until the elections trying to save these pricks who could care less about us and our country any more. I am hanging in there unti we win! Thanks for the encouragement.
Thanks for your input 💪 retail will prevail.
Let’s start a discussion! Leave your thoughts below.
for me as a small shareholder (1000 shares) at $16. It’s hard to believe the stock will ever go above $40 again. Too many myths, speculations, false information are spread. And to this day I don’t know if what Brian wrote is even true. So which one of you pros who can look behind the scenes can tell me that this will all have a happy ending for us apes?