AMC Entertainment Holdings Inc (AMC)

[Prudent Capitalist]

4 Lousy Stocks It's Time to Throw the Towel On

On the heels of sticky inflation and strong economic data, the Fed will likely raise interest rates even higher than previously estimated. The potential rate hikes and an economic downturn are expected to keep the stock market highly volatile. In this scenario, investors should avoid Snap Inc. (SNAP), Plug Power Inc. (PLUG), Peloton Interactive Inc. (PTON), and AMC Entertainment Holdings, Inc. (AMC), given their weak fundamentals and bleak growth prospects.

AMC Entertainment Holdings, Inc. (AMC)

AMC engages in the theatrical exhibition business. The company owns, operates, and has interests in theaters in the United States and Europe.

AMC’s trailing-12-month gross profit margin of 7.43% is 85% lower than the industry average of 49.63%. And its trailing-12-month EBITDA margin of 0.24% is 98.7% lower than the 18.78% industry average. Moreover, the stock’s trailing-12-month net income margin of negative 24.89% compares to the industry average of 3.34%.

AMC’s revenues decreased 15.4% year-over-year to $990.90 million in the fourth quarter that ended December 31, 2022. Its operating loss worsened by 271.5% from the year-ago value to $224.40 million. The company’s adjusted EBITDA was $14.50 million compared to $159.20 million for the fourth quarter of 2021. Also, the operating cash burn generated for the quarter was $57.50 million.

Additionally, the company’s adjusted net loss and adjusted net loss per share widened by 167.3% and 133.3% year-over-year to $152.90 million and $0.14, respectively.

Analysts expect AMC to report a loss per share of $0.42 and $0.33 for fiscal 2023 and 2024, respectively. Shares of AMC slumped 23.7% over the past six months and 33.1% over the past year to close the last trading session at $6.25.

AMC’s weak fundamentals and prospects are reflected in its POWR Ratings. The stock has an overall rating of D, translating to a Sell in our proprietary rating system.

The stock has an F grade for Stability and a D for Sentiment and Quality. Within the F-rated Entertainment-Movies/Studios industry, AMC is ranked last among six stocks. To see additional POWR Ratings of AMC for Growth, Value, and Momentum, click here.

https://www.entrepreneur.com/finance/4-lousy-stocks-its-time-to-throw-the-towel-on/447087