AMC Entertainment Holdings, Inc. (AMC): A Bear Case Theory

We came across a bearish thesis on AMC Entertainment Holdings, Inc. on Valueinvestorsclub.com by sabordesoledad. In this article, we will summarize the bulls’ thesis on AMC. AMC Entertainment Holdings, Inc.'s share was trading at $3.4400 as of July 21^st.

AMC Entertainment Holdings (AMC) continues to face structural headwinds in the movie theater business, which was in secular decline even before COVID-19, with the pandemic accelerating negative trends. Per capita attendance has been falling since the early 2000s, and while box office sales have recovered post-pandemic, gains have been driven by ticket price hikes and higher concession sales rather than audience growth.

Casual moviegoers, a crucial demographic, are increasingly dissuaded by shortened theatrical windows—now averaging around 32 days versus 80–90 pre-pandemic—and the ease of streaming releases. The industry is also contending with a reduced volume of film releases (675 in 2024 vs. 900+ in 2018–2019) and an increasing concentration of box office revenue among a handful of blockbusters.

AMC, despite weaker fundamentals and a highly leveraged balance sheet, trades at a premium valuation: 9.9x NTM EV/EBITDA and 11.4x 2025 consensus EBITDA of $449M versus Cinemark’s (CNK) 8.2x and 8.6x, respectively. With $4.1B of debt and annual cash interest expense of $400M, AMC remains reliant on equity issuance to de-lever. Revenue in 2024 was still 15% below 2019 levels despite significant price increases—tickets +23% and concessions per attendee +50%—a dynamic that erodes affordability and risks further suppressing attendance.

Capex has been cut by 50% to $25k per screen, suggesting underinvestment in maintenance to conserve cash, yet free cash flow remains consistently negative. With only 2M shares left under its current authorization, AMC is expected to seek an expanded share authorization at its 3Q25 AGM, providing a clear catalyst for downside.

Previously we covered a bullish thesis on Netflix, Inc. (NFLX) by Margin of Sanity in May 2025, which highlighted the hidden value in Netflix’s content library, where amortization accounting obscures the enduring revenue potential of older titles. The company’s stock price has appreciated by approximately 5.6% since our coverage as resilient viewership supported the thesis. sabordesoledad shares a contrarian view in AMC, emphasizing structural headwinds from declining attendance, shortened windows, and streaming competition.

AMC Entertainment Holdings, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held AMC at the end of the first quarter which was 20 in the previous quarter. While we acknowledge the potential of AMC as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.