AMC Entertainment, Clover Earnings Letdowns Weigh on Meme Stocks
(Bloomberg) -- Meme stocks fell after quarterly results from AMC Entertainment Holdings Inc. and Clover Health Investments Corp. renewed Wall Street’s skepticism over their bubble-like valuations.
The movie-theater chain slipped 11%, the most since July, as analysts voiced caution over the company’s more than $20 billion market value despite an earnings beat. Clover Health, a health-insurer backed by venture capitalist Chamath Palihapitiya, dropped as analysts at Cowen said the quality of its earnings “remains challenging.”
The underwhelming results spurred a 3.5% decline in a basket of 37 meme stocks tracked by Bloomberg, the biggest drop since the end of September. The group had been red-hot lately as meme mania retook Wall Street, rising 13% to start the month through Monday’s close.
AMC Entertainment remains the top performing retail-trader favorite this year, rising more than 1,700%, alongside the original meme stock GameStop Corp., which has climbed nearly 1,000%.
©2021 Bloomberg L.P.