Why AMC Networks Stock Is Soaring Today
Shares of AMC Networks (NASDAQ: AMCX) surged as much as 18.1% higher on Monday morning. The market reaction followed after a $500 million refinancing move and a bit of ticker confusion. The stock cooled down to a milder gain of 8.1% as of 1:50 p.m., EST.
Early this morning, the cable TV content creator and distributor announced that it is raising $500 million of senior debt papers due for repayment in 2029. The proceeds of this offering will be used to pay down $500 million of existing debt with shorter expiration dates. Nothing too crazy, just a basic refinancing of corporate debt. AMC Networks' balance sheet is in reasonably good repair, balancing $1.1 billion of cash equivalents against $2.8 billion in long-term debt. The company regularly reports positive free cash flows.
However, the similarly named but unrelated company AMC Entertainment Holdings (NYSE: AMC) also reported that it has raised $917 million of fresh debt since December 14. This is a very big deal for the movie theater operator, which is struggling to keep its head above water due to limited movie-going interest and a weak slate of new films during the COVID-19 pandemic.
Source Fool.com
