Several so-called meme stocks are running on Monday. The moves appear to have been sparked by a rally in shares of AMC Entertainment Holdings, Inc (NYSE:AMC), which surged after a court rejected the company's proposed settlement with shareholders.
What To Know: AMC shares tumbled in early April after the company proposed a settlement with shareholders, which would have allowed for the conversion of AMC Preferred Equity Units (NYSE:APE) into common shares. The proposed plan also included a reverse stock split that would have diluted AMC shareholders.
The settlement was met with a class action complaint last month and a special master was asked by Delaware’s Court of Chancery to review the objections. The special master recommended that the court deny the objections, but now things are turning in favor of shareholders.
According to a Bloomberg Law report, Vice Chancellor Morgan T. Zurn rejected the settlement. The Vice Chancellor noted that the ruling didn't concern market manipulation theories, but said the settlement could not be approved as submitted.
Following the ruling, AMC shares soared, while APE units slid. Several other stocks that have a history of being favored by retail investors are moving alongside AMC on Monday. Some of the names making the biggest moves include Koss Corp (NASDAQ:KOSS) and Tupperware Brands Corp (NYSE:TUP). GameStop Corp (NYSE:GME), often considered the original meme stock, was marginally higher, up 1.44% at $22.50 at last check.
AMC Price Action: AMC shares nearly doubled following the news, but have since pulled back.
The stock was up 32% at $5.81 at the time of publication, according to Benzinga Pro.
Photo: Sergei Tokmakov from Pixabay.
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