AMC's Stock Surges To New Highs Yet Again, Leading Across-The-Board Reddit Stock Rally

AMC Entertainment Holdings, Inc.'s AMC rally seems unstoppable, as retail trader-frenzy is propelling the stock to a fresh record high.

AMC Rips To Record: Private placement of 8.5 million AMC shares to Mudrick Capital at a premium drove the shares to a record high Tuesday. The stock closed the session at $32.04, off the intraday high of $33.53.

Reports of Mudrick Capital liquidating its new position did little to quell the retail push. The hedge fund reportedly reasoned shares of the theater chain were overvalued.

See also: How to Buy AMC Stock

Just when it looked like profit-taking may set in following Tuesday's run, AMC shares are seen defying gravity and are extending their recent rally.

But Why? Traders and some sell-side analysts believe AMC will turn the corner due to the return of moviegoers back to pre-COVID-19 levels. Additionally, the company is setting its financials in order by raising capital to pay off debts.

Do the anticipated fundamentals present a strong enough reason for the irrational exuberance shown by retail traders? Recently, B Riley Securities analyst Eric Wold downgraded the stock from Buy to Neutral, citing stretched valuation.

Throwing caution to winds, retail traders — driven in large part by the Reddit community — seem to subscribe to the AMC story. For them, it looks like enjoy the wild ride as long as it lasts.

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Others Not Far Behind: Meme stocks, a name that's been given to stocks that are considered artificially inflated through social media frenzy, especially by retail investors, are moving as a pack.

• In premarket trading Wednesday, AMC shares were soaring 20% to $38.67.
• BlackBerry Limited BB shares were jumping 12% to $13.05.
• Koss Corporation KOSS was advancing 6.3% to $25.67.
• Bed Bath & Beyond Inc. BBBY stock was rising 1.5% to $27.68.
• Takung Art Co., Ltd. TKAT stock was adding 2% to $21.71.
• Notably, GameStop Corp. GME shares were trading flat around $249.50 at publication time.