AMC Stock leaps after New York City says movie theaters may reopen

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Movie theater stocks came back to life late Monday after the New York governor said New York chains could reopen next week with Covid-related restrictions.

This was the news some struggling investors were waiting to hear.

AMC Entertainment Holdings

(ticker: AMC) Stocks climbed 14.9% in the late afternoon, and rose a further 9.6% in the afternoon.

CEO Adam Aron said in a statement that Governor Andrew Cuomo’s announcement “is another important step towards restoring the health of the film industry and our business.”

AMC will reopen its 13 locations in the city on March 5. Capacity is limited to 25%, with no more than 50 people per screen.

While able to open locations across the country, AMC and other theater operators have not been permitted to operate in major cities like New York and Los Angeles due to public health restrictions. And without mainstream success, movie studios have turned to streaming new releases for home audiences.

The reopening of New York appears to be a new chapter for theaters. AMC has made efforts in recent months to consolidate its cash position so that it can weather the pandemic. AMC’s shares have also been taken into a trading frenzy by retail investors who have encouraged each other via a Reddit forum to trade shares using the Robinhood app.

IMAX

Shares (IMAX) also jumped 5.6% on Monday to a new 52-week high, and edged up 0.9% after the close.

Cinemark Holdings

(CNK) rose 6% during the day and 2.5% after the close.

AMC is still down 12% year on year compared to a 16% year on year gain for the S&P 500. IMAX is up 21% from last year, while Cinemark is down 20%.

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