Shares of AMC Entertainment Holdings (NYSE:AMC) traded lower on Friday following the conversion of its AMC Preferred Equity Units (APE) into common shares.
The conversion was effective as of the market open at 9.30am Eastern Time.
The company completed a 10-for-one reverse stock split on Thursday in a bid to keep its stock price high enough to stay listed on the New York Stock Exchange following the dilutive impact of the APE share conversion.
AMC shares, which were priced at $19 following the reverse split, fell on Thursday and continued to slide in early trade on Friday, down 3.9% at US$13.81.
Also weighing on the stock Friday was the news that the release of the highly anticipated sequel film Dune: Part Two was being delayed until March next year due to the ongoing dual Hollywood writers' and actors' strikes, a blow to cinema chains relying on the film to bring in moviegoers.
But Wedbush analysts see the AMC shares returning to $19, their new price target on the stock, once the dust has settled following the reverse stock split and APE share conversion.
They also raised their rating on the stock to ‘Neutral’ from ‘Underperform’ on their view AMC is best positioned to gain market share in the cinema space during the third quarter.
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