Published , by Captain Business
Published , by Captain Business
AMC released their Q2 2021 earnings results this afternoon, which normally wouldn't draw much attention from Shacknews, but the company's CEO mentioned GameStop. So here we are. Reporting this news.
AMC Entertainment CEO Adam Aron spoke to investors on this afternoon's conference call, and seems to have addressed a potential partnership with GameStop (GME) multiple times. "I cannot even count the number of times already that our shareholders have asked us to reach out and partner with GameStop. We're on the case. More to come." Aron went on to say that AMC is "certainly willing" to partner with GameStop, but nothing concrete was announced today.
AMC and GME shares have been grouped together by the mainstream media and even investors over the last seven months of this so-called Reddit meme stock rebellion, and countless times AMC shareholders have tried to inject themselves into the GameStop story. In reality, which is tough for many folks to see, GameStop was the only stock with a short interest above 100% of the float in January, and unlike AMC, GameStop has taken advantage of the stock's run up by issuing shares and paying down all of it's long-term debt. AMC said on the conference call that they do have debt maturing in 2023. So AMC is certainly out of the woods in the near-term, but their balance sheet is nowhere near GameStop's when it comes to liquidity and capital adequacy.
Not that any of this matters. AMC shareholders are not ones to think about fundamentals very much. AMC's CEO seems to realize that, as much of the conference call was spent talking about whatever possible trends the company could attach themselves to. Aron also mentioned that AMC locations will be accepting Bitcoin by the end of the year, but no mention of Dogecoin.
AMC has not changed their business model, and are largely still victims to the ebbs and flows of COVID-19, as cases have started to rise in the United States again. GameStop's new leadership has been focused on a new direction for the company with huge investments being made towards online order fulfillment centers.
GameStop has not mentioned anything about working with AMC, and the company has been largely silent about its meme stock status. Contrast this with AMC, where CEO Adam Aron responds to retail investor direct messages on Twitter, and is clearly trying to keep these folks happy.
GameStop shareholders have also been pitching ridiculous merger ideas, like GameStop joining forces with The Pokemon Company on NFT collectibles. Some of these ideas get labeled as DD (due diligence) by these jaboofers, and it... it's just so... dumb.
Anyway, this story is too dumb for me to continue analyzing it. Don't buy either of these stocks because of a potential partnership or merger may be in the offing. That's not an investment thesis, but then again I am not even sure that matters in 2021. So whatever, do you. Or don't. AMC CEO Adam Aron also said that he does plan on beginning to sell some of his shares in the company by the end of the year, so this insanity may continue for as long as he has more buzzword-filled conference calls to pump the stock.
Angry AMC shareholders who can't believe that Shacknews would write an article questioning if an AMC+GME partnership makes any sense should tweet their concerns @GregBurke85. He's verified and can't wait to reply to all of your totally rational arguments and complaints.
This article is only meant for educational purposes, and should not be taken as investment advice. Please consider your own investment time horizon, risk tolerance, and consult with a financial advisor before acting on this information.