Shares of movie theater operator AMC Entertainment (AMC) closed Wednesday at an all-time low, drastically falling off since the heyday of 2021's meme stock frenzy.
KBW analysts downgraded Rocket Companies (RKT) from "Market Perform" to "Underperform."
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Editor's note: This article was written by Luke Carberry Mogan.
Video Transcript
JULIE HYMAN: Let's talk about another one here, it's AMC. The stock is at an all-time low in today's trading session, down another 8.6% and marking continued turbulence for the stock. Now a couple of things that have been going on here for AMC. The company has been trying to push its debt down by doing equity offerings. It did a bunch of those in December at the market equity offering raising about $350 million over the course of the month.
Also yesterday, B Riley cut their price target on AMC to 12 bucks from 15. They've got a neutral on the shares. And they talk about the box office last year just not being great because of the effects of the strikes.
JOSH LIPTON: Yeah. Of course, the meme stock darling, we all remember along with GameStop, BlackBerry, the Wall Street bets crowd piled in. At one point, AMC trading around 340 bucks but has since crashed back down to earth. Stock's down around 85% in the past 12 months.
But Adam Aaron, right, remains undeterred. You see--
JULIE HYMAN: Unbowed.
JOSH LIPTON: Yeah. Posting on X New Year's Eve, slammed what he called the prophets of doom about the company were wrong, he wrote, said AMC still here, still innovating, still blazing new trails. Now what do analysts who actually cover the name think not so much, not a single buy left on the name here.
JULIE HYMAN: Yeah, no. They're not. And I love, though, how he addresses the apes, right? That's how the fans of the stock have been addressed. And he was the silverback kind of like the--
JOSH LIPTON: Oh, Yeah.
JULIE HYMAN: --the chief elder ape if you will. You know, we'll see what happens going here into this year. I mean, there is a relatively full slate of movies, but will it be enough to get people into the theaters? I mean, there were some hits. The Taylor Swift movie, "Eras" was good for AMC, but it just wasn't good enough to salvage the full year box office.
JOSH LIPTON: Yeah.
JULIE HYMAN: All right, let's talk about another one that has been, by the way, meme-ified from time to time. We're talking about Rocket Companies hit with a downgrade from KBW to underperform from market perform. This coming as Wells Fargo has also gotten more bearish on the stock. Those shares down by 6.5%.
KBW basically looking at the valuation and the company's relative weakness in the purchase market here. He's setting the price target at $10.75, which is obviously below where it is at this point in time. Rocket had sort of an interesting couple of years as well it was down sharply in 21 and 22 after going public and then last year, doubled, but still has not recouped those losses that it experienced from the highs, that is, since it went public.
JOSH LIPTON: Yeah. I mean, a theme here really seems to be with these analysts, it was in part here, it was a valuation call. I mean, at least you looked at Wells Fargo, they said, listen, bottom line, the company is still well-positioned. It's a good company, high quality. But its valuation, it just now looks fair. And they're kind of, in their words, struggling to pencil in material upside from these levels.
And the stock has. I mean, listen, one buy left on the Street at this point, we should note. But what a move. I mean, over the past year, it is up nearly 90% So you would expect after a move like that some folks do move to the sidelines.
JULIE HYMAN: I mean, KBW also, though, pointed out that the company's market share has fallen in refinancing in particular. So that's a little bit of a fundamental case as well, not just on the valuation question.
