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Meme Stocks Find a Groove: AMC and Gaming Play Corsair Top Leaderboard

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Shares of AMC Entertainment are pumping, touching on USD 60 once again thanks to a renewed push by retail investors. After last week’s roller-coaster ride, the stock is tacking on 17% today, inching closer to its peak of USD 62.55 reached on June 2. On Twitter, the hashtag AMC Day is trending as investors look to strike magic yet again after Friday’s rally.

Roller-Coaster Ride

AMC shareholders are patting each other on the back virtually for holding on after last week’s volatility. After seeing the stock lose nearly one-quarter of its value early last week, the stock rebounded but still finished the week down about 11%. Today’s double-digit percentage gain is giving the WallStreetBets Reddit members renewed confidence that the stock has more runway for gains.

Whether AMC stock will make it to USD 80 or even USD 100, which are targets that retail investors have set, remains to be seen. But the Reddit effect is one that will not easily be erased now that the company has decided to issue new shares to the public to raise capital and expand the movie chain’s footprint.

The strengthening of its balance sheet led ratings agency S&P Global to conclude that AMC is on “a path to a sustainable capital structure,” as long as it takes a page out of GameStop’s book and directs the proceeds toward slashing its debt.

Long and Short of It

A group of meme stocks, which are those that have been trading on internet sentiment instead of fundamentals, have even earned their own acronym. Taking a page out of the book of the FANG stocks — Facebook, Amazon, Netflix and Google parent Alphabet — meme stocks are now also being called BANG stocks for BlackBerry, AMC, Nokia and GameStop, solidifying their place in Wall Street history.

AMC is one of the most heavily shorted stocks after the pandemic-fueled lockdowns took a toll on the entertainment industry. According to FactSet data cited by Marketwatch, AMC has 21% short interest compared to just under 17% for GameStop, slightly below 9% for BlackBerry and far ahead of Nokia’s short interest of less than 1%.

Reddit List Newcomer: Corsair Gaming

One newcomer to the Reddit WallStreetBets list is Corsair Gaming. The company has been around for years, but the stock has just recently become the object of retail investors’ affection.

Shares of Corsair have ballooned by 24% today, sending the stock within striking distance of its 52-week high of USD 51.37. Corsair is a play on gaming and e-sports and is behind PC components and gaming gear.

Unlike its meme-stock peers, however, Corsair was not a victim of the pandemic as consumers flocked to PC games while on lockdown. As a result, the company recently reported record Q1 earnings results in which EPS handily beat consensus estimates while revenues soared 71.6% YoY.

Corsair shares are up 13% year-to-date compared to gains of more than 1,000% for fellow gaming and meme stock GameStop. Corsair has short interest of about 18%, according to social media accounts.

This article was originally posted on FX Empire

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