AMC Entertainment Holdings, Inc. AMC shares were trading lower Monday despite the company announcing the highest weekend attendance at theaters since the pandemic began.
What Happened: AMC announced Monday about 3.2 million people watched movies at its theaters globally between July 8 and July 12. The numbers broke the previous post-reopening attendance record and is the second record weekend in three weekends, the company said.
From Thursday through Sunday, AMC had over 2.5 million guests in the U.S., also a post-reopening record.
The company noted that eight of the top 10 busiest theaters in the U.S. over the weekend were AMC locations.
Related Link: Is AMC Entertainment Stock Building Power For Another Break?
Theater Chains In Deep Trouble, Analyst Says: The post-reopening record for theater chains may not mean much and they may be in deep trouble, Rich Greenfield of Lightshed Partners said in an interview with Yahoo Finance.
Studios are growing stronger, and their share could grow to 70%-80% from 60% now, the analyst said.
AMC, Greenfield noted, was not making money pre-pandemic, and the record post-reopening numbers the theater chain is touting are nowhere close to pre-pandemic levels, he said.
LightShed has a $1 price target for AMC shares and the firm is of the view AMC shares are "massively" overvalued.
"This stock should be down far more than where it is today." Greenfield said in the interview.
Movie theaters, according to the analyst, will exist in the longer term but they are going to be a lot less profitable and a lot less smaller businesses than they are today.
Greenfield said AMC will eventually shrink, given it an eroding business, substantial debt and limited avenues for raising money.
AMC shares lost 7.74% Monday, closing at $42.61.
Other theater chains such as IMAX Corporation IMAX and Cinemark Holdings, Inc. CNK were also trading lower, with the former dropping 3.07% to $19.24 and the latter declining 6.59% to $18.98.
Related Link: Imax's CEO On Accelerating Box Office Sales, AMC Entertainment Valuation
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