Meme stock craze dissipates, GameStop and AMC Cinemas continue their decline

GameStop (GME.US) and AMC Theaters (AMC.US) fell for a second day in a row as the meme stock craze that swept the market earlier this week faded.

As the meme stock craze that swept the market earlier this week gradually faded, GameStop (GME.US) and AMC Theaters (AMC.US) fell for a second consecutive day.
Before the market opened on Thursday, GameStop fell as much as 18.28%. AMC once fell 16.06%. As of press time, GameStop fell 14% and AMC fell 6%.
The stocks were enthusiastically embraced by meme traders during the first two days of the week. But on Wednesday, the momentum faded, and the ensuing plunge wiped out $11 billion in the stocks\’ market value.
Matthew Tuttle, CEO of Tuttle Capital Management, said: This kind of stock without fundamental support will be difficult to remain high without a continuous influx of investment.
The massive moves are reminiscent of the heyday of meme stocks in early 2021, when retail traders seized on GameStop and AMC and pushed both stocks to record highs.
Keith Gill shot to fame in 2021 when he called on traders on Reddit to besiege GameStop.
Last Sunday, a post published by his X account once again triggered this wave of meme stocks.
This week\’s large fluctuations have made short-sellers uneasy. But compared with the popularity of 2021, this week\’s fluctuations have been quite mild. In January 2021, GameStop soared by more than 1,600%. The stock has still not regained the record set at that time. Highest price.
Tuttle said: The epidemic is over. All you hear is HODL (meaning HOLD holding) and diamond hands. I think this is all over. They are smarter and understand how to trade these.
AMC doesn\’t expect to be profitable until the holiday quarter, according to analyst estimates. It currently trades at 1,500 times its 12-month forward earnings forecast. That\’s the most among U.S. stocks with a market capitalization of more than $1 billion, according to data compiled. Highest.
In addition, AMC has taken advantage of the situation to cash in. It announced that it has completed the previously announced on-market stock issuance and has reached a private stock exchange agreement to reduce debt.
Sophie Lund Yates, chief equity analyst at Hargreaves Lansdown, said: \”Valuations are still artificially inflated. But these large single-day moves are a reminder for investors risk of investors engaging in speculative trading.

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