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Shares of AMC Entertainment Holdings (NYSE:AMC) are down about 6.5% today after the company declared a special preferred stock dividend to investors.
For the second quarter, AMC reported a loss per share of $0.20, worse than the analyst estimate of a loss per share of $0.19. Revenue came in at $1.17 billion to top the consensus of $1.16 billion. AMC reported a consolidated attendance of 59.13 million.
The company also declared a special dividend of one AMC Preferred Equity unit for each share of AMC Class A common stock.
A Wedbush analyst reiterated an Underperform rating and a $4 per share price target, although she weighed in positively on the special stock dividend.
“We admit that we are encouraged by AMC’s preferred equity announcement, as it will afford the company an opportunity to repay its massive debt and make investments to improve its global footprint,” she told clients in a note.
An analyst from MKM Partners added:
“This action allows AMC to go around its common shareholders who previously voted against any new common share issuances. We do not believe AMC is at risk of running out of cash any time soon, but this action does provide a security blanket in the event of any significant business disruption recurrences,” he said.
