Wedbush Securities Inc. is a privately held investment firm based in Los Angeles. As of February 2022, the firm had $4.1 billion under management with 7,460 clients. Source: Wikipedia
AMC STOCK PRICE TARGET
Wedbush announced a brand-new price target for AMC Stock as of today. They lowered their previous target of $4 per share down to $2 per share due to some recent changes with AMC Stock including the new AMC Ape dividend.
The new $2 price target is because of AMC issuing the new APE dividend which Wedbush believes can lower the value of the shares over time.
AMC STOCK DILUTION
WHAT IS STOCK DILUTION?
Stock dilution defined on Wikipedia is also known as equity dilution, is the decrease in existing shareholders’ ownership percentage of a company as a result of the company issuing new equity. New equity increases the total shares outstanding which has a dilutive effect on the ownership percentage of existing shareholders.
Adam Aron speaks out about APE Dilution
He explains that in the past when AMC issued more shares (or diluted the stock) it actually sent AMC Stock skyrocketing, sort of painting a picture that investors should not “blindly fear dilution” and instead understand all the facts. It is not exactly known at this time what the true plan for dilution is going to look like for AMC stock and APE stock in the longer term future. Dilution is on the front and center of topics moving forward for investors without a doubt.
SHORT SELLERS WRONG ABOUT AMC STOCK?
AMC Entertainment’s big rally this month has pushed mark to market losses for AMC short sellers around $653 Million in losses reported by S3 partners data.
SHORT SQUEEZE UNLIMITED LOSS
When a short squeeze is in fact starting to happen; The stock which is heavily shorted is starting to gain more and more buyers and the short sellers are being forced to buy back their shares as soon as possible, the downside potential for the short sellers is infinite (meaning it could reach any number) until a broker issues margin calls which are likely during this scenario. This is why shorting a stock is so dangerous and why buying a stock which is sold short could be a good opportunity perhaps.
THE BOTTOM LINE
Short squeezes are here to stay in the stock market and those who are most informed could make life changing amounts of money off the next major short squeeze. Timing the next short squeeze will be tricky, but if you know where to look… YOU could be cashing in big during the next major short squeeze to the moon.