Options Market Statistics: AMC Shares Crater as Investors Brace for Stock Conversion, Options Pop

AMC Entertainment shares plummeted nearly 20% on Tuesday, slipping to a new 52-week low of $2.55 per share, as investors brace for a stock conversion later this week.

On Friday, the movie theater chain's preferred equity units, dubbed APE shares, are set to be transformed into common stock just one year after they began trading on the New York Stock Exchange. These preferred equity units are a workaround, of sorts, and free AMC up to sell additional units of stock after investors who feared dilution rejected the company's efforts to issue additional stock last year. AMC raised billions during the Covid pandemic selling new stock, which aided the company in paying off its debts and staved off bankruptcy during a time when movie theaters were closed or had limited product to screen to audiences.

AMC also is planning a 10-to-1 reverse stock split of its common stock on Thursday.

Downgrades of multiple regional banks by S&P Global Ratings could signal challenges within the broader banking sector. If several banks in the same sector face credit rating downgrades, it might suggest a sector-wide issue, such as financial instability, economic uncertainty or credit quality concerns.

This sentiment could lead investors to worry about the health of the sector as a whole, including larger banks like Bank of America and Wells Fargo.

One of the most anticipated vehicle launches of all time is nearing its launch date: the Cybertruck electric pickup truck from Tesla. The launch and subsequent production and deliveries of the Cybertruck are expected to be a major catalyst for Tesla going forward.