APE just became the #1 shorted stock on Yahoo Finance’s ‘Top Most Shorted Stocks List’.
According to Fintel, APE has 8.9 million shares going to dark pools with approximately more than 50.6 million shares having been shorted, via NYSE.
APE’s volume has been above its average volume of 16 million, but institutions are driving the price down through a significant number of borrowed shares.
One can say APE (AMC’s Preferred Equity) is one of the most manipulated securities in the market.
$APE comes just above Bed Bath & Beyond (BBBY) and Carvana (CVNA).
Other companies listed on Yahoo’s Top Most Shorted Stock’s includes Beyond Meat (BYND), MicroStrategy Inc. (MSTR), and Marathon Digital Holdings, Inc. (MARA).
FTDs, or Failure-to-deliver occurs when one party in a trading contract (whether it’s shares, futures, or options) fails to deliver on their obligations.
APE FTDs Chart – Franknez.com | Is APE shorted?
These failures derive due to buyers not having enough money to take delivery and pay for the transaction at settlement.
In the case of sellers, it means not having the goods to meet that transaction.
AMC Issues Warning of Possible APE Short Squeeze
That same month in October, AMC released a statement warning short sellers of the possible losses they could incur in the event of a short squeeze.
“purchasers of our Class A common stock and AMC Preferred Equity Units could incur substantial losses if there are declines in market prices driven by a return to earlier valuations; to the extent volatility in our Class A common stock and AMC Preferred Equity Units is caused, or may from time to time be caused, as has widely been reported, by a “short squeeze” in which coordinated trading activity causes a spike in the market price of our Class A common stock and AMC Preferred Equity Units as traders with a short position make market purchases to avoid or to mitigate potential losses, investors purchase at inflated prices unrelated to our financial performance or prospects, and may thereafter suffer substantial losses as prices decline.”
Retail investors have been buying APE stock in efforts to trigger a short squeeze like when shareholders drove AMC’s share price from $14 to $72 per share.
While one might argue that the price surge wasn’t an actual squeeze, it was certainly a significant move to the upside.
Especially after trading at $2 prior to the ‘meme stock’ frenzy.
Will shareholders be successful at creating a short squeeze for APE?
Afterall, APE is currently one of the most shorted stocks in the market.
“If you can afford to hold the stock, you hold. I don’t own it, but that’s what I would do.
Why? because when RH and the other online brokers open it back up to buyers, then we will see what WSB is really made of. That is when you get to make it all work.
I have no doubt that there are funds and big players that have shorted this stock again thinking they are smarter than everyone on WSB.
I know you are going to hate to hear this, but the lower it goes, the more powerful WSB can be stepping up to buy the stock again. The only question is what broker do you use. Do you stay with RH, who is going to have the same liquidity problems over and over again, or do you as a group find a broker with a far, far, far better balance sheet that won’t cut you off and then go ham on Wall Street.”
Now, although Yahoo Finance listed both AMC and GameStop tied to Mark Cuban’s stock portfolio, he said in the AMA that he does not own them.
Mark Cuban and Elon Musk have been two billionaires that have blatantly spoken out against the SEC.
Since its inception, the SEC has sworn to protect retail investors but has only proven to be complicit to market injustices.
An out of touch Gary Gensler has made it rather clear that keeping his job is more important than actually enforcing the law.
Here’s what Mark Cuban had to say about the SEC:
“The SEC is a mess. I wouldn’t trust them to do the right thing ever. It’s an agency built by and for lawyers to be lawyers and win cases rather than do the right thing
If the SEC gave a shit about ANYONE other than Wall Street you would be able to go there right now and read bright line guidelines about insider trading, shorting, what is a pump and dump, what are the rules for cutting off the purchase of stocks like happened with GME et al
But they won’t. They would rather litigate to regulate, which means they love to sue people in order to create new legal precedents.
All you need to know about the SEC and how badly they want to fuck the little guy is that they have the option of using JUDGES THAT WORK FOR THE SEC when they sue you rather than you have the option to have jury of your peers in front of a judge that is independent. Thats how bad the SEC is. If you want fair markets that doesn’t benefit Wall Street call your local politician and show them this.”
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The Markets in General Are Bouncing
The SPY has created a triple bottom around the $360 level so far and hasn’t come down since.
First in June, again in September, and last in October.
October is the month when SPY began to bounce from this major level of support.
Around the same time, AMC Entertainment stock was having a bounce from its major level of support around $6.30 per share.
Is it possible the market in general has hit the bottom?
It’s very probable, although it’s fair to mention any official talks of a recession can easily crash the market.
If we do begin to see further continuation, we might enter a short squeeze season where stocks begin to have sudden price surges from shorts closing positions.
Last year, AMC and GameStop gained mainstream attention when retail investors began to buy heavily into these two ‘meme stocks’ despite their high short interest.
Users over at Wall Street Bets identified that with enough buying pressure, they could force short sellers to rush and close their short positions in order to refrain from taking on massive losses.
This buy-back of shares would further fuel the buying pressure already being applied from retail investors; GameStop shot up over $483 per share.
In June of 2021, AMC Entertainment stock surged from $14 per share to $72 per share.
Will History Repeat Itself?
Market News: Will AMC squeeze again?
AMC’s short interest was around 21%-22% before short positions began to get closed.
AMC’s current short interest is at 21.64%.
This means that with enough buying pressure, retail investors might just have the chance to recreate the events that occurred last year, possibly even bigger.
But I’m curious to hear your thoughts on AMC’s rising short interest today.
AMC Entertainment is now up more than 40% since the publication of my ‘buy alert‘ on the blog and newsletter.
Take it from someone who said buy AMC at $6 per share last year before it ultimately surged to $72 per share and crippled Wall Street.
The point I’m making is the market is shifting and it’s very possible we begin to see AMC retrace to higher levels it created last year.
Of course, there are many factors that may break or make this a possibility.
The major one being retail and institutional investors both buying the stock en masse.
Which as we know, usually tends to happen during a bull market.
AMC’s Fundamentals Today will Play a HUGE Role Tomorrow
Institutions were buying AMC stock mainly during the second quarter of 2021 when retail investors sparked confidence towards the upside.
And retail investors haven’t left despite massive shorting in the market.
Based on what we’ve seen in the past, a new all-time high for AMC could very well come to fruition in the next bull market.
The reason behind this observation is that institutions and retail investors were buying AMC Entertainment stock even when the movie theater chain was on its knees.
There was still big suppression from short sellers who did not see any fundamental value in the company.
It’s for this sole reason why more institutions will likely purchase the stock during the next bull run, because AMC has significantly improved fundamentally.
AMC’s fundamentals today are going to play a huge role tomorrow.
It’s just a matter of time before retail investors get to see this play out in real-time.
Granted that we enter a bull market in 2023, it’s very possible AMC has a short squeeze due to excessive buying pressure from both institutional and retail investors.
Fintel is currently reporting AMC’s short interest at 21.64%, which means there are plenty of open short positions that may trigger an AMC short squeeze in 2023.
When AMC’s share price skyrocketed to $72 per share, AMC’s short interest dropped from 21% to 14% due to hedge funds buying back their shares.
And with AMC’s increasing borrow fee rate, it only puts more pressure on hedge funds to begin this process.
Market News | Business News: AMC launches online merchandise store.
AMC Entertainment just launched their online merchandise store.
Shareholders have been inquiring about AMC branded merch since last year during quarterly earnings call announcements.
Now AMC Entertainment has officially begun doing business with their new merchandise line which consists of pullover hoodies, crew necks, t-shirts, and more.
This new revenue stream is giving AMC Entertainment the opportunity to capitalize big from shareholders and customers alike.
AMC already has millions of shareholders and supporters who want to see the company succeed.
I don’t think the company will have any issues selling AMC merchandise to such a big and loyal following.
We can expect sales reports during AMC’s Q4 earnings call early next year.
Why AMC Merchandise Matters
In October, AMC reduced its debt by $106 million while extending their maturities that were due in 2023 until 2027.
While the company might still have north of $5bn in debt, AMC has gradually beat earnings expectations while tackling debt in one form or another.
The movie theatre’s primary objective has been to increase their revenue while paying down their debt.
AMC branded merchandise creates a great income stream for the movie theatre chain, especially during this time when the company has been able to amass such a big following.
The retail trade industry allows AMC Entertainment to tap into a $6.9 trillion-dollar industry to grow its efforts in paying down debt and to capitalize from a new revenue stream.
What Are Your Views on AMC Entertainment?
Where to buy AMC merchandise? AMC stock news today.
The sale of AMC branded merchandise is a great way to spark more revenue for the company.
Not only will this venture increase sales but it will also promote AMC organically via the wearer.
Marketing and sales at the same time?
Great move AMC.
Customers will also begin to see AMC branded popcorn at their favorite grocery stores very soon.
Another one of AMC’s branded ventures to increase revenue.
How do you feel about AMC merchandise?
Do you think this will create more value for the company long-term?
Stock Market News: Amazon to invest billions per year in the movie theatre industry.
BREAKING: Amazon plans to invest more than $1 billion per year into theatrical distribution releases per Bloomberg news.
Amazon.com Inc. will be investing billions of dollars to produce movies that will release in theatres, according to people familiar with the company’s plans.
This is the largest commitment to the movie theatre industry by an internet company, says Bloomberg.
The world’s largest online retailer aims to make between 12 and 15 movies annually that will get a theatrical release.
Amazon is still sorting out this strategy said people who asked not to be identified.
That number of releases puts Amazon on par with major studios such as Paramount Pictures.
This is bullish news for the movie theatre industry and industry leader, AMC Entertainment.
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Amazon Sparks Theatrical Release Competition
Market News: Amazon is investing billions in movie theatre industry.
Amazon is now setting itself up as a direct competitor to major studios such as Paramount Pictures in its new multi-billion-dollar investment plan to release several films in theatres.
While most major studios have been around for a long time, Amazon is coming in hot with the news that has AMC shareholders in particular excited for the fundamental growth of the movie theater business.
Shares of AMC surged more than 6% amidst the announcement.
Volume picked up as well, exceeding its average volume of 26 million to more than 30 million.
The news is huge for the movie theatre industry who Wall Street has bet against for the past several years, but more specifically since the start of 2021.
Retail investors are now armed with massive confidence in the movie theatre industry.
This news has the potential to spark heavy buying in movie theatre stocks such as AMC again.
One thing is certain, movie theatres and shareholders aren’t leaving, sorry Charles Gasparino.
CNBC Says Amazon News is a ‘Positive Sign’ for Movie Theatre Industry
“While a $1 billion annual investment for film development is on the lower end of what major Hollywood studios spend each year, it’s a positive sign for the movie theater business, which has struggled in the wake of the pandemic.”
Is the narrative changing?
Is now time for short sellers to throw in the towel before large institutions go long and begin piling in?
Despite AMC Entertainment beating earnings expectations every quarter since 2021, short sellers on Wall Street have aimed at shorting the company out of existence.
But the retail community made up of millions of investors have been the strongest support for AMC Entertainment.
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Citigroup Bets Against AMC Entertainment
Stock Market News: Citigroup unethically shorts AMC Entertainment stock.
Citigroup currently holds call options representing 0 of underlying shares valued at $0 USD and put options representing 55,000 of underlying shares valued at $383,000 USD.
The bank has been selling shares while playing put options in order to profit from the drops they’re triggering in the market.
This incredible advantage over retail investors has the AMC community raising awareness of the market injustices created by banks and hedge funds alike.
The leverage banks have is unlimited when compared to the buying power of retail investors.
Retail is wondering when will regulators acknowledge the hard-working American people who simply want a leveled playfield when it comes to investing their money?
Gensler has been under heavy scrutiny by retail investors as concerns over the past two years have fallen upon deaf ears.
But that’s not all.
Citigroup is also using the media to promote a $1.20 share price target for AMC Entertainment.
That’s right, as of November 7th, 2022, Citigroup has dropped AMC’s price target from $3.13 per share to $1.20 per share.
Citigroup shorts AMC Entertainment stock – Franknez.com. Source:Benzinga
Looks like Citigroup is doing everything they can to profit from AMC by selling shares, playing puts, and promoting a declining price target using the media.
Raise awareness by sharing this article and using hashtag #BanCitigroup.
Market News: Short sellers face major risk as AMC’s short interest, volume, and short borrow fees rise.
AMC’s high short interest is one of the biggest confirmations AMC Entertainment stock can squeeze again.
Of course, there’s the second component which will trigger it, and that’s volume.
We’ve seen spikes in AMC’s share price during heavy volume days, something we saw on a weekly basis before AMC reached its all-time high of $72 per share last year.
Retail investors bombarded the stock market and fueled massive rallies through heavy buying pressure.
AMC might have the short interest it needs to rip again, but does it have the liquidity it needs from retail investors?
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AMC Short Interest Today
Fintel is reporting AMC’s short interest today at 19.76%.
Other platforms are reporting AMC’s short interest at 20%; so, we have an idea of where it’s rounded at.
This high short interest is quite risky for short sellers as any major rebound could put bets against the movie theatre chain in significant losses.
While it made sense for institutions to go short when AMC’s share price began dropping after its peak, AMC has hit strong levels of support today, making it ideal for buyers to step in.
Institutions may also begin to buy back in at current levels, very well knowing an AMC short squeeze is possible.
AMC’s short interest today is around the same as it was prior to the massive surge from $14 to $72 per share.
This means those betting on AMC to squeeze this year already have one major component checked off.
Big players closing their short positions in AMC may trigger big price runup at any moment.
They just have to decide the tide is turning against their position for retail to see this.
Volume Forced Big Price Action Last Year
What will trigger AMC to squeeze?
Average volume this year for AMC Entertainment stock has come down significantly from last year’s bull market.
But this is expected as massive selloffs occur in a bear market and investor confidence subsides momentarily.
Soon institutions along with retail investors combined will begin to pick the markets back up.
And with it, turn the tide against short sellers.
The market will experience major squeezes, not just from AMC, but from various shorted stocks too.
Heavy buying pressure is the key to successfully trigger a short squeeze in the market.
AMC and GameStop proved that last year when massive crowds of retail investors began to buy shares of both companies in heavy volumes over a period of months.
If you missed last year’s momentum waive, it’s possible very soon we may see what could be the last time an event like this occurs again.
But of course, this will all depend on investor sentiment.
Because if there are no investors in AMC, then there is no volume.
And if there is no volume, there’s no tide to turn against short sellers.
Short Borrow Fee Rises
AMC’s short borrow fee rate has risen substantially compared to earlier this year.
The short borrow fee rate is currently at 44.30% compared to 1% in early 2022.
This is the fee hedge funds pay annually to borrow shares to short AMC stock.
Last week the short borrow fee had increased to96.30%!
This means it’s becoming less convenient to borrow shares at the moment; a risk headstrong short sellers must currently face.
Now it’s costing more than ever to short AMC stock and it’s also riskier than it was prior to this year’s bear market.
Bear markets usually only last about a year compared to bull markets who tend to make it to almost 4 years.
At some point, a reversal is imminent, and short sellers who fail to close their positions while they still can, will be caught in a massive tide.
An AMC short squeeze is a ticking timebomb, and unless stocks can drop forever, it’s one you cannot disarm.
New investors getting into the stock market will be looking to capitalize on opportunities such as an AMC short squeeze.
Institutional and retail investor confidence in the market is what’s going to create big volume in the coming weeks as the market continues to bounce.
Worst Case Scenario?
When will AMC go up again?
My short-term view on AMC Entertainment stock is bullish.
Worst-case scenario is a bounce takes on more of a long-term approach.
Consolidation in AMC will indicate indecision, which means retail investors will need to step it up and demonstrate to institutions AMC is worth going long on.
Afterall, Wall Street can only deny AMC’s progress for so long until the narrative takes a complete 180 degrees.
But ultimately, retail investors are the key here.
Without retail investors, without the public, without the people, AMC stands no chance against Wall Street pessimists who have mainstream media to their advantage.
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