AMC Entertainment is reopening its movie theaters in Los Angeles — and that’s goosing the company’s shares.
The world’s largest movie theater operator said late Friday that it would open two theaters in LA, its biggest market, on Monday. The announcement drove AMC’s stock up more than 20 percent in early Monday trading.
The shares — which have surged more than sixfold this year during the “Reddit Rally” that has also boosted shares of previously down-and-out names including GameStop — recently changed hands at $13.19, up 18 percent.
Movie houses in LA county, the home of Hollywood and the largest moviegoing market in the US, have been closed for a year due to the COVID-19 pandemic. Local authorities in California cleared movie theaters to resume operations staring on Monday if they limit attendance to 25 percent capacity.
AMC said it would return to business starting with theaters in Burbank and Century City. The company plans to begin opening the rest of its theaters in the Los Angeles area, and elsewhere in California, starting on March 19.
For AMC, LA is the company’s largest market by number of theaters with 56 doors in California including 25 in LA County.
Movie theater chains and independent cinemas have been devastated by pandemic-related closures, but there have been some recent bright spots as the COVID-19 vaccine has become more widely distributed in the US.
The site said if trends continue, ticket sales may reach $4.5 billion to $6 billion in 2021, which is roughly triple the volume of last year, but far below the level of 2019’s blockbuster $11.4 billion year.
The US box office has shown slow improvements led by new films like Disney’s “Raya the Last Dragon,” which has grossed $15.8 million since opening on March 5, and Warner Bros.’ “Tom & Jerry,” which has reeled in $28.2 million since it debuted on Feb. 26, according to ticket sales site Box Office Mojo.
Adjusting for inflation, a $6 billion year would be less than the movie biz generated in 1982 when Steven Spielberg’s two big flicks, “E.T.” and “Raiders of the Lost Ark” ruled the box office, according to a Bloomberg report.
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