What's up guys and welcome to wall street millennial? Recently, amc has experienced yet another short squeeze with a stock increasing 36 percent. In less than two days it reached an intra-day peak of 14 dollars and two cents on friday may 14th. This brings amc to almost where it was around. The second gamestop short squeeze in mid-march at its current price of 13 is more than six times its two dollar price.

Before the original short squeeze in january. During the pandemic, amc was heavily attacked by short sellers who thought the company would go bankrupt by the end of 2020. It looked as if the prediction would come. True, they were running out of cash and the stock fell to a low of two dollars.

However, with the help of wall street vets, the stock is now 73 above the pre-pandemic level. They also have more than one billion dollars in liquidity that will allow them to comfortably survive until movie-going rebounds this summer. In a recent earnings call amc ceo, adam aaron, praised wall street bets and said he's more than happy to have retail investors as the owner of his company. The support from the ceo has further legitimized wall street bets and driven even more hype.

Around amc, many wall street vets apes now call adam aaron the silverback, as he is the leader of the apes wall street vets. His pumping up of amc stock almost certainly saved the company from bankruptcy. This saga shows the growing power of individual investors. Ceos will increasingly have to consider the desires of retail investors as they become more important in the markets throughout 2020.

Amc's short interests hovered at around 100 million dollars in early 2021, the gamestop short squeeze took amc to the moon with it. This short squeeze caused storage sellers to lose billions of dollars. Instead of giving up short sellers doubled down, they figured after the run-up amc shares were almost certainly overvalued and will have to come back down eventually also with amc's market cap exceeding 5 billion dollars. There is a larger free float to support the short position.

Thus, short interest went up to almost 900 million dollars in april of 2020. The most up-to-date figures amc took advantage of the elevated share price by issuing more than one billion dollars of new stock. On may 13th, they announced they successfully completed an offering of 43 million shares, which raised 428 million dollars of proceeds normally, when a company issues more stock, the price goes down. This is because the new stock dilutes the existing shareholders stake in the company.

However, in the case of amc, the opposite actually happened. The new money rates further strengthens amc's balance sheet. They now have over one billion dollars in liquidity, which is the most they have ever had in their history. This liquidity gives them more than enough time to survive until the summer season and takes bankruptcy risk off the table.

Many retail investors saw this news as a bullish sign and piled into amc with short interest at record levels. This induced another short squeeze and sent shares skyrocketing more than 30 in the first quarter. Earnings conference call amc, ceo, adam aaron was very supportive of wall street vets. I'm quite optimistic about the new shareholder base of amc.

Um just go on twitter just go on reddit. Just go on youtube, read what these people write, they love amc. This is, and these are not people who are just going to be investors in amc. These are going to be customers of amc who come to our theaters and enjoy watching movies in our theaters as paying guests.

So i love the idea that we have a compassionate, committed, enthusiastic shelter base and i'm sure that, as we work together, management and ownership we'll come to the right answer. Look at what we've achieved as i've. You know the whole point of my prepared remarks. Look at what we've achieved in the last year, we're going to achieve good things the next year and the year after that too um the uh.

The only thing that'll be different, though, is before when i wanted to talk to the company's ownership. I could fly to beijing and i could sit down with three or four people and they had 75 of the votes or i could talk to some of you. Analysts who were in frequent contact with people who also had huge percentage votes, uh uh of our company's shareholding base. We go on non-deal road shows with you all and meet this institutional investor or that institutional investor and make our case and make our pitch.

Well, it's going to be a little different now because i don't have five people in one office. I don't have 15 securities analysts who talk to all these institutions. We've got 3.2, i would say we have. As on march 11, we had 3.2 million people who we're going to have to talk to to explain what the company's up to what the company's doing what the company wants to do.

Why we want to do it, how it impacts them and do they agree with it and so you're going to see a lot more outreach to literally millions of investors in our company and it's going to be quite public. I've started tweeting again back when i ran the philadelphia 76ers. I was tweeting 15 times a day and i don't think i've tweeted 15 times a year in the last five years at amc, but i started tweeting again and we are communicating with our shareholder base. Some of you saw may have seen a youtube interview that i did try getting four minutes on cnbc, that's pretty hard.

Well, we got 90 minutes on youtube and it had 250 000 views and you know on youtube. They get to grade it. They give you a thumbs up or a thumbs down, and the last time i looked over, twenty thousand people took the time to rate it. This 90 minute interview and 99.4 percent of them gave us a thumbs up.

So it's going to change the way we communicate and it's going to change who we communicate to uh, but i'm very confident that the outcome will have a happy ending adam aaron's comments. Predictably, were met with great exuberance from wall street beds. They now call him the silverback of the amc apes wall street vest users refer to themselves as apes to represent the sense of community on the subreddit. This terminology comes from the hit film rise of the planet of the apes in the movie, the protagonist caesar says: apes together is strong, a single ape alone is weak, but when they work together, they can accomplish great things.

The collective action of the wall street bets apes, saved amc from bankruptcy, large male gorillas, grow silver, hair on their backs, leading to the name silverback. Typically, a large silverback gorilla is the leader of his tribe. In the view of wall street bets, adam aaron is now the silverback at the head of the amc bowl case. The stock market is a mechanism for allocating capital to companies.

If the company's share price is high, it has the ability to issue new shares and use this money to fund growth projects. Investors decide which companies have good growth prospects and bid up their share prices. Accordingly, on the flip side, when short sellers think, a company is doomed to fail, they push the price down by shorting. This is what happened with amc in 2020.

Traditionally, these capital allocation decisions were made by big hedge funds and institutional investors on wall street. However, with the rise of wall street bets, the balance of power has now shifted in favor of the individual investor. Retail investors now have the power to move stock prices to the tunes of tens of billions of dollars. However, success is not guaranteed.

Amc's issuing of new shares has significantly diluted the ownership stake per share in march of 2020. They had 104 million shares outstanding after their most recent capital raise. They now have 443 million that's more than a four times increase. Despite this dilution, the share price is more than 70 higher than the pre-pandemic levels to justify this share price amc's attendance and revenues will have to far exceed 2019 levels over the next couple years.

This is far from certainty, but with the help of wall street vets, the amc, silverback adam aaron lives to fight another day, alright guys that wraps it up for this video, if you like, the content, make sure to smash that like button and subscribe for future videos. Also make sure to check out our second channel wsm research, where we post dd on high growth stocks. If you want to support this channel click, the join button to become a channel member channel members, get access to our videos one day in advance and get to vote on some of our video topics. As always.

Thank you guys so much for watching and we'll see in the next one wall, street millennial signing out.