Shares of Helios and Matheson Analytics (NASDAQ:HMNY) rose five-fold earlier this week as the company announced that it secured $65 million in new funding for MoviePass, the company’s once-popular, but now-troubled subscription movie going service. The big move in HMNY stock makes some sense. After all, MoviePass is a great idea.

Subscriptions are the future of the movie theater industry. But, MoviePass spread itself too thin, trying to offer an unreasonably good deal that ended up being, well, unreasonable. MoviePass has since restructured, but cash burn remains the biggest question mark. Thus, securing additional funding does give MoviePass another day to survive.

But, additional funding won’t save MoviePass or HMNY stock for two major reasons.

First, we have no idea where the funding came from, what type of funding it is, or what HMNY had to give up to get that funding. In other words, this new funding is a $65 million black box. Until somebody opens up that box, investors have no idea whether or not the $65 million is actually a good thing for HMNY stock (it could be debt, and that would be bad).

Second, even if everything checks out with the funding, MoviePass is a day late and a dollar short. The movie theater subscription industry has moved on from MoviePass. AMC (NYSE:AMC) now dominates the space with its subscription service, A-List. AMC dominance and MoviePass erosion will persist for the foreseeable future because AMC has all the leverage in that competition.

Overall, investors shouldn’t read too much into HMNY’s new funding. It isn’t a game-changer, nor is it a reason to buy HMNY stock.

The Funding Is Mysterious

The big thing here is that we don’t know anything about this mysterious additional $65 million in funding. We don’t know where it came from, what form it comes in, or what MoviePass had to give up to get it.

For example, this could be $65 million in debt financing. If so, this isn’t great news. HMNY isn’t profitable, nor has it been profitable in recent memory. If anything, HMNY has been the poster child for cash burn. Loading up a balance sheet with debt for a company that is far from being profitable isn’t a recipe for success. It’s actually a recipe for disaster.

Even if it wasn’t debt, $65 million isn’t all that much. Last quarter, HMNY reported an operating loss of over $100 million. Thus, at the current rate, $65 million doesn’t even cover one quarter’s worth of operating losses.

Overall, the headline “MoviePass raises more funds” sounds good. But, upon a closer inspection, the news isn’t that great. MoviePass didn’t raise that much, and there are serious question marks around what it did raise.

AMC Is a Way Better Deal

Longer term, the big problem with MoviePass is that it is being priced out of the market it invented by a far more competent competitor.

AMC, America’s largest movie theater operator, has launched its own movie theater subscription service called Stubs A-List. From the onset, A-List was better in almost every way. You can buy tickets in advance and online. A-List works at all AMC theaters. It also works for all movies. Most AMC theaters have their own VIP concessions line for Stubs members.

Now, though, A-List is also cheaper.

A-List offers movie-goers three movies per week for essentially $20 per month. Annualized, that is 156 movies per year for $240, so the per movie cost is roughly $1.50. MoviePass recently restructured to 3 movies per month for essentially $10 per month. Annualized, that is 36 movies per year for $120, so the per movie cost is roughly $3.30, more than double the A-List per movie cost.

Sure, there is an argument out there that consumers really don’t go to the movies more than three times per month, so they should just sign up for MoviePass. But, that is where all the other benefits of A-list come in (advanced buying, no hiccups, accepted for all movies, so on and so forth).

Overall, the value prop of A-List is simply far higher than the value prop of MoviePass. As such, this market will continue to shift in favor of A-List, and that will cause HMNY stock to remain depressed.

Bottom Line on HMNY

A good rule of thumb is to never buy a stock trading at $0.01. This rule of thumb applies to HMNY stock. Don’t buy it. Instead, buy AMC stock. I’ve been pounding on the table for a while that AMC is the real winner here. AMC stock has outperformed over the past several months, and will continue to do so for the foreseeable future.

As of this writing, Luke Lango was long AMC.