AMC Entertainment (AMC) shares rallied more than 10% on Friday after receiving a big vote of confidence from Alicia Reese, a senior Wedbush analyst.
In her research note this morning, Reese upgraded the world’s largest cinema chain to “Outperform” and raised her price target to $4, indicating potential for another 20% upside from current levels.
Despite today’s surge, AMC stock is down more than 19% versus its year-to-date high in late May.
Why Is Wedbush Bullish on AMC Stock?
Alicia Reese recommends buying AMC shares at current levels as they could meaningfully benefit from a “more consistent release slate over the next several quarters.”
AMC has the “most premium screens in North America” – which she believes will help the NYSE-listed firm grow its market share not just in the second half of this year, but in 2026 as well.
Additionally, AMC plans on growing its footprint in European Union and the United Kingdom, which may also contribute to significant further upside in its stock price, the Wedbush analyst added.
Her bullish call is significant given AMC stock is already up more than 20% versus its YTD low.
Box Office Rebound to Boost AMC Shares
Investors should consider building a position in AMC stock also because the Hollywood box office has shown signs of a rebound in recent months.
According to Alicia Reese, the movie theater company looks attractive also because its recent debt restructuring agreement “relieves near-term uncertainty” and enables management to focus on operational growth.
More importantly, the Wedbush analyst is convinced that AMC is now free from the need to issue more shares – effectively removing concerns of dilution.
Note that Reese’s bullish call on AMC shares is the first one the company has received since 2020.
AMD Is Still Widely Known as a Meme Stock
Despite Wedbush’s positive view, investors should practice caution in buying AMC shares as the entertainment firm has a history of instability and is still broadly known as a meme stock.
According to Barchart, the consensus rating on AMC stock remains at “Hold” only with the mean target of about $3.12 indicating potential downside of some 8% from here.
