AMC Entertainment Soars, Then Falls After Slashing Dividend
It's not often a company handily beats analysts' earnings expectations, then turns around and slashes its dividend, but AMC Entertainment (NYSE: AMC) did just that. The movie theater operator cut its quarterly payout 85% to $0.03 per share even though fourth-quarter revenue rose 2.4% year over year, and adjusted earnings of $0.35 per share trounced Wall Street's forecast of just $0.10 per share.
While AMC said it actually could afford to pay the dividend if it wanted to, but the company "believes that given recent trading ranges for AMC shares, it is wiser to return cash to shareholders in the form of share repurchases."
The theater operator's stock has fallen around 60% over the past year, apparently making it too cheap for management to pass up.
Source Fool.com
