Why AMC Stock has soared today

What happened

Actions of AMC Entertainment (NYSE: AMC) jumped on Monday after the nation’s largest film company said it had raised $ 917 million in equity and debt. At 2:45 p.m. EST, AMC’s stock price was up 30%.

So what

AMC’s new cash includes $ 506 million from share sales and $ 411 million from new debt. Management believes that these measures will allow AMC to “survive this dark winter affected by the coronavirus”. “Today the sun is shining on AMC,” said Adam Aron, CEO of AMC, in a press release.

AMC Entertainment shares rebounded after shareholders received promising news on Monday. Image source: Getty Images.

Aron even went so far as to say that investors no longer have to worry about the AMC failing in the short term. “This means that any discussion of impending bankruptcy for AMC is completely irrelevant,” Aron said.

Now what

With its strengthened balance sheet, AMC believes it has the necessary liquidity to finance its operations until “until 2021”. The company warns, however, that its future cash flow needs are difficult to predict in part due to uncertainty over the rise in coronavirus infections and the yet-to-be determined results of COVID-19 vaccination programs.

“Going forward, for the CMA to be successful in the medium term, we’re going to need a large portion of the general public in the United States and abroad to get vaccinated,” Aron said.