AMC and GameStop Stock.

hey everyone kevin here in this video

i'm going to talk about my thoughts on

amc and gme i'm going to talk about why

these stocks are falling in the after

hours i'm also going to provide you my

perspective on these particular stocks

and i'm going to provide you with

exactly what my position is related to

these two stocks in the stock market

i'll give you screenshots and i'll

actually just pull up my weeple and show

it to you but for now let's go ahead and

see what the heck is going on we'll keep

this nice and concise and if you like

that make sure to hit that like button

alright so check this out amc is down

2.15 percent in after hours down 0.9 on

the day amc has obviously run up

substantially from some of the lows that

we had at the end of july and the middle

of august which is great we've had a

very nice recovery we are heading back

to sort of bouncing off that

50.85 level we've worked out plenty of

times before but we are nicely above

that 41.75 level right now which is

excellent for amc we jump on over to gme

first thing is i do have much less

technical analysis on gme i'm going to

talk a little bit more about

fundamentals on gme but we see a little

bit of a curvature here to the downside

following a run at the end of august we

ran at the end of august from around

that mid 160s range

all the way up to a high of 231 dollars

per share and presently we're sitting at

about 198 dollars a share we are

slightly down in the day and we've also

fallen in after hours in fact if we look

at the after hours we're all the way

down to 181 it's almost like we're going

back to that mid 160s range within 8.7

decline so what happened today well two

things happened today first thing is amc

amc announced or released on fox news

this really incredible i mean really

emotional piece of artwork uh a tv

commercial and and very enticing a tv

commercial campaign with nicole kidman

who i can't believe is over 50 years old

she's incredible but anyway

she is a star in this commercial and

this commercial really you've got to

watch it it entices you to go to the

movie theaters like when you watch it

you feel the emotion of the movies

beginning to play and like the beginning

of a movie all that hope and

anticipation of when that movie starts

and everybody goes quiet and the the

lights turn out it's great they did a

phenomenal phenomenal job on their tv

commercial this was announced on fox

there were some tweets also

of some securities attorneys trying to

threaten fox suggesting that fox might

get sued for helping promote the moas or

a mother of all short squeezes

suggesting that there's no fundamental

basis for a moass and therefore because

fox is promoting the moas fox might be

exposed to potential litigation for

promoting a short squeeze where there

might not otherwise be a short squeeze

which i thought was really

uh unsavory i thought it was very very

wrong that securities attorneys would

come out against the amc movement

because we have to remember that short

squeeze aside amc and gme represent a

movement it's kind of like in my opinion

black lives matter and i'm not trying to

get political here it's just they each

represent something right so you think

about it this way black lives matter

represents social inequality and decades

of making it harder for just for example

black folks to build wealth through

owning real estate because of redlining

or just straight up discrimination

blockbusting and real estate the fact

that people couldn't get loans or that

home value some black communities were

lower right it so black lives matter

represents a movement finding a solution

for these inequalities right in my

opinion

the amc gme momentum movement the short

squeeze movement the ape nation movement

represents a frustration over

the suits and a lack of transparency a

lack of transparency around short

interest data why is it that ortex has

their data here and then s3 partners has

their data here and then the truth is

somewhere else but nobody seems to know

except the hedge funds and the suits and

the suits are the same kinds of people

who are like oh how dare you fox looking

out for the little guy well screw you

suits you know charles payne and some of

the folks at fox have been the most open

to this ape movement ever

compared to anyone else out there

the exception of

cnbc but i will only mention cnbc

because i kind of feel like they're

playing catch up to fox like they're

like oh man charles payne is doing such

a good job here and the other folks over

at fox are doing such a good job on fox

biz

cnbc is playing a little bit catch-up

but anyway

point is gotta respect the amc movement

and the gme movement the ape nation i

respect it it represents much more than

the underlying stocks and that's why i

actually increased my exposure to amc

and i'll show you exactly how i did that

in just a moment

but for now let's focus on amc and gme

so

amc

incredible tv commercial uh incredible

rumors about potential partnerships or

talks or advertising talks with gamestop

and excitement over what is to come uh

adam aaron had an excellent interview on

fox business today was very impressed

with him

now we have to see will this new

marketing effort this 25 million amc

marketing effort will that translate

into

revenue that's what matters now remember

adam aaron says we've got about two

billion dollars in cash or credit lines

i expect that most of that is credit

line and that's generally because it

makes more sense to have your high

interest rate credit lines paid down

than just to have a lot of cash sitting

around but yeah look we've got cash

equivalents at amc and this enables us

to advertise and get nicole kidman i

mean what an honor what an honor to see

movie theaters like amc now advertising

themselves rather than just movies

themselves right it used to be and adam

aaron mentioned this it used to be that

tv commercials would just advertise the

movie and then go look at it in amc

right this whole commercial you got to

watch it you could see i'll link it down

below the whole commercial is all about

see

a movie

in amc because it's a theater and it's a

full experience you got to enjoy it it's

excellent it's awesome so now that's amc

let's touch on gme and we're going to

show you some shares and some things

that i'm doing all right

jimmy now we got some talking to do

about this one so it bothers me a little

bit that they're not doing q a sessions

in the earnings call the reason for that

is as someone who is a real estate

investor and negotiator specifically a

negotiator when it comes to real estate

you know we don't really negotiate with

stocks right

we like to think we do but we generally

don't i negotiate a lot in real estate

and in my opinion the q a session is the

most important to understanding what's

really going on i want to see people on

the hot seat under pressure responding

to questions this is why i think all

politicians should always be forced and

compelled to debate

because i want to see a leader under

pressure i don't want to see somebody

falter in the face of fake news i don't

want to see someone give up in the face

of fud

i want the truth

and i want that reaction from people and

so i'm a little bit disappointed that

there's no q a session in the earnings

calls

it bothers me

now i'm obviously bullish

on the movement that amc and gme

represent

but i'm not so excited about some of the

details in the earnings call today i'm

going to give you the good and then the

bad

from what we have which is very very

limited because the good that we have

well we're going to go through that but

the potential for bad is very very

limited because we got a very catered

outline no forecasts and no q a

let's talk about some of the good

so the first thing that's worth

mentioning is that year-over-year sales

are up substantially they're up 25.6

percent where we just crossed a billion

dollars in revenues at gme we're at

1.183 billion dollars compared to 942 in

2020 in the second quarter

now

i personally am not super jazzed about

that second quarter reading why because

the second quarter represents april may

and june

okay april may and june we were just

barely getting our first stimulus check

people hadn't gotten their ppp money yet

people hadn't gotten their eid l money

yet the markets were not flush with as

much money just yet april may june of

2020. i think real consumer spending

started coming back

uh in in you know the third and fourth

quarter in other words this 25.6 revenue

growth is good the net sales growth is

good

but i am worried we are comparing year

over year to a big hole

now i know a lot of people during the

pandemic in the lockdowns spent more

money on video games but then you also

had the problem of a lot of game stop

stores potentially being locked down

especially in california where they

weren't open anyway and people were

buying their video games online

so i really think you're comparing to a

hole comparing to q2 2020 now we'll see

at least it's up i mean up 25.6 that is

good i have my reservations but that is

good

now

the ceo of gamestop does mention that

they were able to achieve this despite a

9 reduction in stores due to the

pandemic

this sounds good again but in my opinion

also relates to this comparison back to

a whole

yes gamestop is consolidating its stores

now with this 25.6 growth i also thought

it was interesting that the ceo

mentioned by the way we believe quote

net sales is how people should evaluate

us in other words assess the stock

well yeah because that is also one of

the best metrics that you have right now

the big big big big tell to me is how

are we doing quarter to quarter i'm

gonna pull that up for you right now

folks take a look at this okay this

these are just the numbers this is not

me trying to be a bear or or a bull it's

just looking at the numbers okay net

sales for the first quarter of 2021 was

actually higher net sales of 2021 were

1.276 billion dollars we came in at 1.83

that folks is a quarter over quarter

decline which we did not hear mention uh

divided by 1276 that is a decline of

about seven percent that's a quarter

over quarter decline of seven percent

and you have to pull up the q1 earnings

release to actually see this because

they don't give you the comparison in

this quarterly report and they didn't

have q a right then when we look at sg a

let's go ahead and do the math here so

sg a here sat at

378 divided by 1183 that works out to

about 32

and in the quarter over here q1 sgna

worked out to 370 divided by 1276 worked

out to 29 percent

so you had a two percent increase

quarter over quarter in sg a and a seven

percent reduction in sales quarter over

quarter that's not good you have a

softening in quarter over quarter sales

but the ceo doesn't mention that the ceo

mentions hey we're up 25.6 compared year

over year that's despite a nine percent

reduction in same store sales and our sg

a is doing better compared to the second

quarter of last last year

okay like i i want amc i'm sorry i want

gm well i want both of them i want both

of them to win and succeed

but here's what i ask

be real with us

be real with us like look if i got bad

news and you know this if you watch this

channel you know this about me

if i got bad news you know i will tell

you i'm not gonna lie to you i'm not

gonna deceive you i'm not gonna tell you

something's uh green and crystals when

it's actually garbage and

moldy grossness

i'm gonna be blunt with you

so i don't like those things and we're p

picking these things out because these

are specifically things that the ceo

cheered

now the good news is clear

gme doesn't have debt no debt no

borrowings they've got a little bit of

debt they got a small term loan with the

french government it's like a pandemic

relief loan so most people don't really

consider that even though technically is

debt most people don't consider it they

spent 28.2 million on capex they're

making investments into this they gave

no guidance we know this but we've got

1.775 billion on hand

cash they did this by selling 5 million

shares at the money or at the market

right

they've got a lot more money than they

had last year a billion dollars more

they lost less money than they've lost

in previous quarters which is good

they're at 642 stores which is still a

very sizable company strengthened their

balance sheet a lot they leased a new

customer care facility in pembroke pines

florida which is actually five minutes

away from where i used to live in

florida they're hiring talent for this

customer for customer care there i

personally think the focus should be a

little bit different for example if i

were on this board i'd be pushing for

things like what can we do to partner

with companies like corsair to sell

gaming pcs memory cards chips become the

best buy of gaming what can i do to

partner in innovative ways with other

businesses where i can sell games where

the people are like how can i partner

with dave and busters for example to

have a gamestop kiosk so that way while

people are sitting there eating taking a

break and they're having fun playing

games they're like hey we should take

home a nintendo switch and uh super

mario brothers or whatever like

bring the games to where the people are

right partner with sports betting firms

like draftkings whatever

look it's great that we've got a 500 000

square foot fulfillment facility opening

up next year nevada and that the york

pennsylvania facility is already

starting to ship products this is good

we're playing catch up with amazon it

needs to be done this is bare minimum

this is good it's bare minimum though i

want the vision the problem is right now

we're not getting the vision now a lot

of vision is expected to come from ryan

cohen who's the chairman of gamestop

he's not the ceo he's the chairman of

the gamestop board he also was the

co-founder and ceo of chewie now he's no

longer at chewy which is partially good

because chewie has not had the best year

so far their last earnings was a big

oopsy doopsy oopsies which is not good

uh he did step down to spend more time

with family so that has nothing to do

with him there's a separation i just

want to make that clear because some

people think that he still works at

chewie it's just worth disconnecting

those things he just focused on well i

imagine family and gamestop which is

great uh and the ceo mentions that hey

look we're in the process of bringing in

new innovative products some of the

things they mention and i imagine ryan

cohen has a lot to do with what what's

happening here they mention more focus

on products collectibles and electronics

i'm really hopeful that electronics are

things like pc gaming equipment i hope

by collecting collectibles they mean

nfts which remember you there's a

website gamestop made a whole nft

website splash page teasing nfts coming

so i'm really hopeful that they've got

big things brewing because there's

there's not much to love in the

fundamentals right now what we need for

gamestop is hope you know like

some vision uh and we're not getting

that right now and i think that

frustrates the stock market because the

stock market is impatient i'm not

suggesting people sell uh but uh you

know i i why is the stock down it's

because people like hope in the stock

market you know with the hope opium lead

stocks to go up uh and i'm such a big

fan and proponent of the movement i

really want to see gamestop and gme

gamestop and amc succeed now i did

promise you that i would show you my

position in at least amc uh that is

because i don't have shares in gamestop

i do not own anything uh in gamestop but

i do own shares in amc uh and i promised

you i would hold amc shares for at least

a year

this is my weeble scroll to the amc

section so what you can see here on

screen

right about let's see here so here

where my finger is

these are the shares i have i have 2 100

shares

i sold a covered call for 55 to get a 24

500 credit i sold that last month

sometime

so i just have to make sure like if amc

goes over 55 that i get rid of that

contract so i don't get called out right

but this is just a way of lowering my

cost basis see it cost me i don't know

exactly how much it cost me i think

that's market yeah that's market value

uh it cost me probably somewhere well

i'm up whatever 80 bucks or 40 bucks or

whatever it is so it cost me somewhere

around 97 000 to buy these shares

if this option expires worthless it

basically reduces my cost basis by about

25 which is really awesome right here's

another thing though that lowers my cost

basis right here and actually increases

my exposure to amc is i sold puts

between now and january of 2023

which forced me to buy

2 000 amc shares which would be like

doubling my position in amc

if amc

sells for under 40 dollars

by january of 2023

so i'm making that commitment that amc

is going to be above 40 for the long run

now i could be wrong then i'd be forced

to buy the shares right so i'm playing

options on both sides here milking

credits i'm really particularly liked

this one right here the reason i like

this one a lot is because uh

two thousand shares at forty dollars

would cost me

eighty thousand dollars and i got a

forty one thousand dollar eight hundred

credit which is crazy that's a little

bit more than 50

so anyway this gives you a little bit of

perspective into my thoughts amc gme

everything that's going on if you found

this helpful make sure to subscribe

thank you so much for watching and folks

we'll see you the next one bye

[Music]