Retail investors were net sellers of AMC on Tuesday for the first time since February even as the stock surged 9%

AMC stock
  • Retail investors were net sellers of AMC stock on Tuesday for the first time since February, according to new data from Vanda Research.
  • That occurred on the same day AMC shares closed 9% higher.
  • Vanda attributes the upward price movement to buying by institutional investors.
  • See more stories on Insider’s business page.

Retail investors were net sellers of AMC Entertainment stock on Tuesday for the first time since February, even as shares climbed 9%, according to new data from Vanda Research.

The firm says the gains were instead driven by institutional investors.

“Many hedge funds are now trying to anticipate changes in retail sentiment and buy these stocks before mom and pop investors get involved,” Vanda analysts wrote.

The stock is now up more than 2,000% since the start of 2021.

AMC on Tuesday said more than 2 million people attended a movie at its theaters during Labor Day weekend, surpassing attendance for the same holiday weekend in 2019, before the coronavirus pandemic hit.

The firm noted a stark slowdown in retail purchases of AMC shares. According to Vanda’s data, day traders were buying more than $1 billion per week during peak meme-stock rallies in January and June. But since the stock’s latest rally started in August, they’ve bought less than $250 million.

AMC has been a day-trader favorite for months, attracting loads of posts on social-media sites like Reddit’s Wall Street Bets, StockTwits, and Twitter. Those retail investors have banded together on multiple occasions to squeeze the shares of heavily shorted companies higher.

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How to find meme stocks like GameStop and AMC: Your complete guide to spotting and profiting from hot stocks on social media and Reddit’s Wall Street Bets

Stonks meme
Meme stocks have been arguably the biggest market trend of 2021.

  • Meme stocks like GameStop and AMC Entertainment have taken the investing world by storm in 2021.
  • Small-time retail traders have banded together in a rebellion against Wall Street hedge funds.
  • Insider regularly interviews experts who share how to spot meme stock surges.
  • Below is a compiled list of stories covering everything you need to know about meme stocks. You can read all about the trend by subscribing to Insider.

Stocks have steadily advanced in 2021 as the economy rebounded from the pandemic, but the S&P 500’s solid gains pale in comparison to those of previously left-for-dead companies like GameStop (GME) and AMC Entertainment (AMC).

Those long-suffering stocks shocked the world by spiking as much as 1,700% and 2,800%, respectively, and ushered in a new era of investing in what are now known as meme stocks.

Meme stocks have no precise definition, but they’re not hard to spot. Common characteristics of these select few stocks include sudden rallies and volatile price swings on unusually high trading volume.

The action is typically driven by members of online forums like Reddit and social media users, who sometimes make and share memes to promote and build momentum around the stock’s rally. But stocks that meet the above criteria can be considered meme stocks without having a big online following.

Below is a comprehensive breakdown of Insider’s coverage of the meme stock movement and how investors can profit from it.

Top meme stocks now

Retail investors are always searching for stocks to send “to the moon.” Below are some of the hottest names that social media users are buzzing about during the week of August 23.

Read more:

How to trade meme stocks

Trading meme stocks isn’t as simple as it sounds. It takes hours to surf through Reddit forums for the next trendy stock, and it requires a huge, carefully coordinated online movement to send individual stocks spiking.

But sending meme stocks to the moon isn’t rocket science either. Insider has interviewed investing pros who have simple strategies for spotting meme stocks, as well as the creator of a site that saves investors time by scanning Reddit forums for the next big meme stock.

Just as important as finding the next hot meme stock is avoiding common trading mistakes. An analyst who’s covered GameStop since 2002 told Insider how to spot short squeezes and avoid getting burned, and a strategist shared how to avoid landmines in a rapidly evolving investing landscape that now includes meme stocks.

Read more:

How the meme stock movement began

GameStop is widely considered to be the first meme stock. The long-beleaguered video-game retailer suffered for years as its sales were cannibalized by e-commerce giants like Amazon and by the video-game industry’s shift to online games. Its C-suite became a revolving door for executives: Three different CEOs led the firm in 2018 alone.

GameStop’s miraculous surge began in January 2021 after Ryan Cohen, the founder of online pet-store company Chewy, joined the company’s board and inspired optimism among investors. Cohen could spearhead GameStop’s e-commerce efforts and help the company get back on track, investors believed.

But the main reason behind GameStop’s monumental move was a massive short squeeze.

Convinced the video-game seller was destined for the same fate as Blockbuster, a handful of Wall Street pros bet against the stock through shorting, a process where investors borrow shares of a company they think will decline, then sell them immediately in hopes of buying them back at a cheaper price before returning them and booking a profit.

Small-time traders flipped the script on hedge funds by driving the price of the heavily shorted shares up, forcing the bears to close their positions by buying back borrowed shares, which perpetuated the cycle. The stock then rose to the moon, and the rest is history.

Read more:

What to know about the dangers of meme stocks

If getting rich off meme stocks were easy, thousands of Redditors would be millionaires.

The harsh reality of markets is that for every buyer, there must be a seller. For every trader that nailed the bottom of a stock, someone else sold at the worst possible time – and every time an investor sells at the peak, someone must have bought ahead of the crash. Some unlucky soul bought GameStop shares at its all-time high of $483.

By definition, investing in meme stocks is incredibly risky, and poorly-timed trades can lead to massive losses. Critics have said the practice creates “false markets” and reflects how the market is broken.

Michael Burry, the hedge fund mogul who predicted the housing market crash, told Barron’s via email earlier this summer that a meme stock crash could come soon.

“I believe the retail crowd is fully invested in this theme, and Wall Street has jumped on the coattails,” Burry said. “We’re running out of new money available to jump on the bandwagon.”

Read more:

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These are the top 10 stocks Reddit’s Wall Street Bets is talking about right now

Reddit Wall Street Bets Retail Trading GameStop
  • Reddit’s Wall Street Bets forum entered the mainstream during the January GameStop craze.
  • From GameStop to AMC Entertainment, retail investors congregating on the subreddit are a driving force in the stock market.
  • These are the top 10 stocks Wall Street Bets is talking about right now.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

It’s paid to follow what stocks Reddit’s Wall Street Bets crowd are talking about this year, as several have gone through epic rallies and seen heightened volatility.

From GameStop in January to AMC Entertainment in June, the near 11 million-member forum has driven the conversation in so-called meme stocks that have exploded higher amid overwhelming demand from retail investors. Strong demand for stocks with shaky fundamentals has led to several hedge fund blowups that were caught on the opposite side of the trade betting against the company in question.

GameStop’s short-squeeze, in-part led by the Wall Street Bets crowd, led to a more than 50% drawdown in multi-billion dollar hedge fund Melvin Capital. Meanwhile, the sharp rally in struggling movie theater chain AMC Entertainment caused billions of dollar in losses for short-sellers in May and June.

But while some stocks popular with the Reddit crowd have seen massive gains, some have also seen epic losses. In the past month, many meme stocks have seen accelerating declines, with AMC Entertainment and GameStop both down more than 50% from their June highs.

As traders look to replicate the success of Wall Street Bets stocks, one data aggregator is compiling the most mentioned stocks on Reddit’s forum.

These are the top 10 stocks Reddit’s WallStreetBets forum is focused on right now, according to data compiled by SwaggyStocks. The list is based on mentions over the past 24 hours.

10. McAfee

Ticker: MCFE
Wall Street Bet Mentions Over Past 24 Hours: 138
Market Capitalization: $12.8 billion
1-Week Performance: 9%

McAfee

9. Virgin Galactic

Ticker: SPCE
Wall Street Bet Mentions Over Past 24 Hours: 146
Market Capitalization: $7.8 billion
1-Week Performance: 2%

Virgin galactic whiteknighttwo
A Virgin Galactic spacecraft attached to its carrier vehicle, WhiteKnightTwo.

8. GameStop

Ticker: GME
Wall Street Bet Mentions Over Past 24 Hours: 153
Market Capitalization: $11.3 billion
1-Week Performance: -7%

GameStop
Queue in front of Gamestop store in Christmas atmosphere in Milan during coronavirus emergency, Milan, Italy, on November 03 2020.

7. Cloudfare

Ticker: NET
Wall Street Bet Mentions Over Past 24 Hours: 170
Market Capitalization: $28.3 billion
1-Week Performance: 1%

Computer hacker silhouette
Computer hacker silhouette

6. Tesla

Ticker: TSLA
Wall Street Bet Mentions Over Past 24 Hours: 193
Market Capitalization: $688.4 billion
1-Week Performance: 6%

Tesla SuperCharger

5. AMC Entertainment

Ticker: AMC
Wall Street Bet Mentions Over Past 24 Hours: 251
Market Capitalization: $17.3 billion
1-Week Performance: -12%

AMC Entertainment

4. MicroVision

Ticker: MVIS
Wall Street Bet Mentions Over Past 24 Hours: 258
Market Capitalization: $2.2 billion
1-Week Performance: -3%

MicroVision Lidar rendering.
MicroVision Lidar rendering.

3. Moderna

Ticker: MRNA
Wall Street Bet Mentions Over Past 24 Hours: 259
Market Capitalization: $163.4 billion
1-Week Performance: 19%

Moderna IPO.JPG
Noubar Afeyan at the Moderna IPO.

2. AMD

Ticker: AMD
Wall Street Bet Mentions Over Past 24 Hours: 280
Market Capitalization: $132.1 billion
1-Week Performance: 10%

AMD Radeon

1. Robinhood

Ticker: HOOD
Wall Street Bet Mentions Over Past 24 Hours: 1,070
Market Capitalization: $42.6 billion
1-Week Performance: 46%

Robinhood logo stocks investing
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The hedge fund badly bruised by betting against GameStop is still struggling after ending the first half with a 46% loss, report says

Gabe Plotkin

Gabe Plotkin’s Melvin Capital Management, targeted by the Reddit army of day traders for its bearish GameStop bets, ended the first half of the year with a 46% loss, Bloomberg reported.

The New York-based hedge fund, which suffered a stunning 53% loss in January from the Reddit-trader short squeeze, gained 1% in June. But it is still struggling to recover, Bloomberg said in the Thursday report, citing sources familiar with the matter.

Melvin Capital, founded by star portfolio manager Plotkin, did manage to stage something of a comeback with a 22% gain in February. But its overall first-quarter loss stood at 49%, Insider understands.

The hedge fund got torched by the Reddit army alongside other high-profile firms that had big bets against GameStop when day traders banded together to send shares of the gaming retailer skyrocketing. When the price of a stock rises, short sellers must typically cover their positions by buying shares at that higher price.

Melvin Capital lost a chunk of its assets in the trading frenzy, ending January with $8 billion in assets, down from $12.5 billion at the start of the year. Its assets had risen to $11 billion as of June 1, the Financial Times and Bloomberg reported.

After the January hit, the fund has somewhat recovered. It is up 18% for the five months between February and June, Insider understands. It gained 5.4% in the second quarter.

The hedge fund is understood to be taking smaller-sized positions to limit its exposure to single companies. It exited its public short positions against GameStop, AMC and other stocks in the first quarter, but may have still held non-public, more traditional short positions.

Founder Gabe Plotkin has also asked a team of data scientists to comb through social media and day-trader forums for stock names of interest to retail traders, Bloomberg reported.

A spokesperson for Melvin Capital declined to comment.

Read More: Prominent market bear Albert Edwards warns that investors who prematurely bet on higher inflation are set up for further losses – and lays out the pathway to record-low bond yields

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These are the top 10 meme stocks Reddit’s Wall Street Bets is talking about right now

WallStreetBets

It’s paid to follow what stocks Reddit’s Wall Street Bets crowd are talking about this year, as several have gone through epic rallies.

From GameStop in January to AMC Entertainment last month, the 10.6 million-member forum has driven the conversation in so-called meme stocks that have exploded higher amid overwhelming demand from retail investors. Strong demand for stocks with shaky fundamentals has led to several hedge fund blowups that were caught on the opposite side of the trade betting against the company in question.

GameStop’s short-squeeze, in-part led by the Wall Street Bets crowd, led to a more than 50% drawdown in multi-billion dollar hedge fund Melvin Capital. Meanwhile, the sharp rally in struggling movie theater chain AMC Entertainment caused billions of dollar in losses for short-sellers in May and June.

As traders look to replicate the success of Wall Street Bets stocks, one data aggregator is compiling the most mentioned stocks on Reddit’s forum.

These are the top 10 meme stocks Reddit’s WallStreetBets forum is focused on right now, according to data compiled by SwaggyStocks. The list excludes mega-cap tech stocks and is based on mentions over the past 24 hours.

10. Cleveland Cliffs

Ticker: CLF
Wall Street Bet Mentions Over Past 24 Hours: 89
Market Capitalization: $10.3 billion

GettyImages 1228399692
Hot molten steel in a blast furnace.

9. Virgin Galactic

Ticker: SPCE
Wall Street Bet Mentions Over Past 24 Hours: 124
Market Capitalization: $10.7 billion

Virgin galactic whiteknighttwo
A Virgin Galactic spacecraft attached to its carrier vehicle, WhiteKnightTwo.

8. BlackBerry

Ticker: BB
Wall Street Bet Mentions Over Past 24 Hours: 145
Market Capitalization: $7.0 billion

A shareholder uses his Blackberry while waiting for the Research In Motion annual meeting to begin in Waterloo, July 17, 2007.
BlackBerry shareholder

7. Palantir

Ticker: PLTR
Wall Street Bet Mentions Over Past 24 Hours: 192
Market Capitalization: $46.9 billion

Palantir

6. Clean Energy Fuels

Ticker: CLNE
Wall Street Bet Mentions Over Past 24 Hours: 196
Market Capitalization: $2.0 billion

Clean Energy Fuels

5. SoFi

Ticker: SOFI
Wall Street Bet Mentions Over Past 24 Hours: 227
Market Capitalization: $13.9 billion

sofi fintech

4. GameStop

Ticker: GME
Wall Street Bet Mentions Over Past 24 Hours: 275
Market Capitalization: $14.4 billion

GameStop
Queue in front of Gamestop store in Christmas atmosphere in Milan during coronavirus emergency, Milan, Italy, on November 03 2020.

3. ContextLogic

Ticker: WISH
Wall Street Bet Mentions Over Past 24 Hours: 289
Market Capitalization: $7.7 billion

Wish CFO
Wish CFO Rajat Bahri.

2. AMC Entertainment

Ticker: AMC
Wall Street Bet Mentions Over Past 24 Hours: 297
Market Capitalization: $26.1 billion

AMC Entertainment

1. Clover Health

Ticker: CLOV
Wall Street Bet Mentions Over Past 24 Hours: 468
Market Capitalization: $4.3 billion

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Chamath Palihapitiya, Founder and CEO of Social Capital LP, speaks at the Sohn Investment Conference in New York on May 4, 2016.

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AMC jumps 10% as the Reddit favorite reports the most customers in a weekend since reopening

Vin Diesel driving a car in "Fast and Furious 9."
Vin Diesel in “Fast and Furious 9.”

  • AMC Entertainment jumped as much as 10% on Monday after it reported strong traffic at its theaters over the weekend.
  • The company said more than 2 million customers visited its movie theaters over the weekend.
  • The new ‘Fast and Furious’ movie installment helped drive a post-pandemic box office record.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Meme stock and Reddit favorite AMC Entertainment soared on Monday, surging as much as 10% following a strong weekend at the movies.

Driven by hot weather and the opening of “Fast and Furious 9,” AMC saw more than 2 million guests visit its theaters over the weekend, representing a post-pandemic record for the company.

“Fast and Furious 9” also broke records, with the movie generating $70 million in ticket sales over the weekend. That’s the biggest opening weekend for a movie since 2019’s Star Wars: The Rise of Skywalker.

According to AMC, six of its movie theater locations represented the top 10 busiest theaters in the US. And an additional 500,000 people visited AMC’s international locations over the weekend, according to the company.

“The combination of widespread vaccination and the release once again of blockbuster movies is proving to be the magic formula for the return of moviegoing,” AMC CEO Adam Aron said.

Shares of AMC are up more than 2,600% year-to-date and have cost short-sellers billions in losses.

Despite the near-record stock price and an improving outlook for movie ticket sales, some investors remain unconvinced that AMC is worth its current market valuation of nearly $30 billion. Short interest as a percentage of AMC’s entire share float still stands at just below 20%, according to data from ShortSqueeze.

AMC Entertainment stock chart
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Reddit is auctioning 3 ethereum NFTs featuring its alien mascot Snoo

KIEV, UKRAINE - 2018/08/14: In this photo illustration, the Reddit social networking website seen displayed on a smartphone.
Snoo, the alien mascot of Reddit.

  • Reddit is selling three “CryptoSnoo NFTs” that feature its famous alien mascot.
  • “Take advantage of this rare opportunity to own a piece of Reddit history-snag a CryptoSnoo NFT,” the website said.
  • Once purchased, buyers will get access to a URL that will take them to a webpage dedicated to their NFT.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Reddit is auctioning three non-fungible tokens powered by the ethereum blockchain, with the social media site taking bid from now until July 1.

The tokens are called “CryptoSnoos NFTs” and feature the famous alien mascot of the social media site. The Block was first to report.

“Take advantage of this rare opportunity to own a piece of Reddit history-snag a CryptoSnoo NFT,” the website said.

The three CryptoSnoos NFTs are named Original Block, Helium, and Snooprematic.

All were minted on June 17 and are on sale on NFT platform OpenSea.

According to Reddit, Original Block is inspired by Reddit’s characteristic Snoo caricature. Helium, meanwhile, is associated with the “contemporary art movement” and “everyday objects that are blue and sparkle.” Snooprematic is influenced by a “geometric vocabulary.”

A screenshot of Reddit's NFT called CryptoSnoos taken from its official website.
Reddit’s NFT called CryptoSnoos.

The current highest bid for Original Block is $3,959.82, for Helium it’s $1,979.91, and for Snooprematic, it’s $1,394.07.

Once purchased, buyers will get access to a URL that will take them to a webpage dedicated to their NFTs.

NFTs are unique digital assets secured on a blockchain. Each NFT has its own signature, which can be verified in the public ledger and cannot be duplicated.

NFTs have soared in popularity in 2021. Artwork, tweets, and news columns turned into digital art have fetched millions of dollars at auction.

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The CEO of AMC gifted his twin sons 500,000 shares in March. Now the holdings are worth more than $30 million after the stock’s massive surge.

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AMC Theaters CEO Adam Aron accepts the Sid Grauman Award on behalf of AMC at the 33rd American Cinematheque Award at the Beverly Hilton Hotel on Nov. 8, 2019.

  • AMC CEO gave his twin sons 500,000 shares of the movie theater chain in March, Bloomberg reported.
  • At that time, the gift was worth about $6.8 million, but following a massive surge, the value of the shares has ballooned five-fold.
  • AMC’s monster rally catapulted the company to record highs Wednesday, with a year-to-date gain of as much as 3,325%.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

AMC Entertainment CEO Adam Aron gave his twin sons 500,000 shares of the movie theater chain in March, at the time worth about $6.8 million, according to a March 17 filing with the Securities and Exchange Commission, Bloomberg first reported.

But following a massive surge, those shares have seen a five-fold gain and are now valued at around $31.2 million.

As for Aron, the filing revealed that his shares and longer-term grants are now worth more than $260 million.

AMC’s monster rally catapulted the stock to record highs Wednesday, with its market valuation surpassing $30 billion. The stock’s year-to-date gain in the previous session surged to as much as 3,325%.

The meteoric rally has some analysts sounding the alarm yet again over unrealistic valuations. David Trainer, CEO of New Constructs, said AMC’s stock is trading at levels that are disconnected from fundamentals.

“There is no fundamental reason to be buying shares of AMC Entertainment,” Trainer said in a statement. “We think AMC Entertainment’s stock is worth $0 per share, given its weak earnings, dilution from recent stock offerings and mountain of debt.”

AMC shares are trading lower by 21.03% to $49.39 as of 12:13 p.m. ET Thursday.

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AMC surges 126% as Reddit cheerleaders overpower large hedge-fund share sale

amc theaters
  • Shares of AMC Entertainment surged as much as 126% on Wednesday before trading was halted for volatility.
  • The move comes after hedge fund Mudrick Capital dumped shares on the same day it was disclosed the firm bought 8.5 million units.
  • Retail traders on sites like Reddit remained bullish on the meme stock.
  • See more stories on Insider’s business page.

AMC Entertainment surged Wednesday despite a share dump from hedge fund Mudrick Capital.

Shares of the world’s largest movie theater operator jumped as much as 126% to trade around $72, triggering a halt for volatility. The surge built on Tuesday’s gains, which pushed the stock 23% higher during the session to close at $32.04. AMC shares have now spiked almost 500% in just seven trading days.

The Leawood, Kansas-based company announced Tuesday it raised $230.5 million in cash after agreeing to sell 8.5 million shares to Mudrick Capital for $27.12 each, a dollar higher than the stock’s Friday closing price. Shares surged following the news as the company said it would use the funds to make acquisitions, improve consumer appeal, and deleveraging.

Just hours after the announcement, Mudrick Capital sold its entire stake at a profit, Bloomberg reported. Despite the share dump, the meme stock continued its rally early Wednesday as retail traders remained bullish. The stock remained one of the top talked-about companies on Reddit threads like Wall Street Bets, HypeEquity data showed.

AMC has led a broader rally in meme stocks, like GameStop and BlackBerry, so far this week amid renewed interest in the retail-trader favorites. BlackBerry, for its part, closed 15% higher at $11.56 Tuesday and continued rallying in early morning trading, as GameStop closed 12% higher at $27.02 Tuesday and upticked just slightly Wednesday.

Last week, shares of the movie theater operator rallied for days after private Chinese conglomerate Dalian Wanda Group announced it sold nearly all of its remaining stake in the company. Retail traders cheered the newly available shares, more than doubling the stock price through the course of the week.

Retail traders have invested in heavily shorted stocks like AMC and GameStop, in an effort to squeeze short sellers, who have lost billions on their bets. But shorts haven’t given up as short interest in the stocks is 21%, according to MarketBeat data.

If you’re a Millennial or Gen Z investor willing to share your investing experience, reach out to the reporter of this article at ndailey@insider.com.

Read more: Morgan Stanley identifies 28 underappreciated, high-quality stocks to own as the market’s most expensive names are due to continue underperforming

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