Why AMC Entertainment Is Falling 6% Today

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Shares of AMC Entertainment Holdings (NYSE: AMC) were tumbling 6% lower in morning trading Wednesday after the movie theater operator announced it would be selling 50 million more shares to raise cash to survive.

AMC is trying to avoid bankruptcy and says it needs some $750 million to make it through to the end of 2021. And while it would like to be able to borrow that money, it has not been above issuing new stock to raise cash.

Yet by adding more shares to the market, the theater operator is diluting existing shareholders. Earlier this month AMC registered 200 million shares.

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