7 Meme Deals AMC Should Consider During Its Next Bargain Hunt


Meme Deals - 7 Meme Deals AMC Should Consider During Its Next Bargain Hunt

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  • Ayro (AYRO): AMC could turn itself into an electric vehicle (EV) play by buying this maker of small EVs.
  • Cinedigm (CIDM): If it can’t beat streaming, the movie theater operator may just as well join them, by buying this content streaming company.
  • Chicken Soup for the Soul Entertainment (CSSE): Another potential streaming target; AMC could find big synergies buying it along with Cinedigm.
  • Genius Brands (GNUS): Another streaming play AMC could consider.
  • IDW Media Holdings (IDW): For a low price, AMC would gain a library of comic book franchises that can be monetized.
  • PLBY Group (PLBY): PLBY owns a valuable brand, and is an NFT/metaverse play to boot.
  • Super League Gaming (SLGG): An inexpensive way for AMC to gain a foothold into the metaverse space.

While remarking about his recent Hycroft Mining (NASDAQ:HYMC) acquisition, AMC Entertainment (NYSE:AMC) CEO Adam Aron has stated he wants to make more “meme deals.”

There already are whispers that AMC may be taking the first steps in turning itself into a meme conglomerate. A meme deal is a transaction that looks questionable from a financial standpoint, yet piques meme traders’ interest.

The buzz from the Hycroft Mining deal played a big role in the AMC rebound last month. Shares have pulled back since then, but future deals could provide future boosts. With a $1.8 billion war chest, Aron has plenty of cash to pursue what he refers to as “transformational” deals.

So, after Hycroft, what other meme deals should Aron consider for AMC? These seven could in theory elicit a positive response from meme traders if pursued.

Ayro AYRO $1.22
Cinedigm CIDM $0.80
Chicken Soup for the Soul Ent. CSSE $11.08
Genius Brands GNUS $0.92
IDW Media Holdings IDW $1.74
PLBY Group PLBY $12.01

Meme Deals: Ayro (AYRO)

idex stock: Concept art of an electric vehicle with a charging cord coming out.
Source: Shutterstock

While many EV plays may be too big for the company to take a position, much less acquire outright. Ayro (NASDAQ:AYRO) might be small enough for it to gobble up.

A maker of small EVs that can be used in tight areas like college campuses, corporate campuses and resorts, it could find success targeting such a niche market.

With a $46.5 million market capitalization, the movie theater operator could easily buy all outstanding shares of AYRO stock. Even if it paid a hefty premium.

While it would have to spend millions more to cover its operating losses (around $33.25 million in 2021), the bump-up in AMC’s stock price could more than make up for it.

Cinedigm (CIDM)

Image of Cinedigm (CIDM) logo in a black web browser, amplified by a magnifying glass.
Source: Pavel Kapysh / Shutterstock.com

In the pursuit of “transformative” meme deals, AMC could also scoop up businesses similar to its own.

One in particular it should consider is streaming company Cinedigm (NASDAQ:CIDM).

As the saying goes, “if you can’t beat them, join them.” Buying this company, which operates over-the-top (OTT) ad and subscription-supported streaming networks, would be a great way to gain a foothold in this space that has stymied AMC’s recovery.

Cinedigm is also in the film distribution business as well. This deal, if pursued, could both excite meme traders, as well as make sense from a strategically.

CIDM stock, as you may recall, was a bit of meme stock in 2021. Since then, however, it’s dropped in price considerably. With a $137.8 million market capitalization, this is another name AMC could easily buy outright.

Chicken Soup for the Soul Entertainment (CSSE)

Image of a person pressing a button on a laptop and a holographic projection of a music player appearing to represent streaming stocks
Source: Shutterstock

Keeping with the streaming theme, Chicken Soup for the Soul Entertainment (NASDAQ:CSSE) is another streaming play AMC could acquire/invest in as a “transformational” meme deal.

This company owns a streaming platform of the same name, along with platforms like Crackle and Popcornflix. For the past year, it’s been building up its content library. Most recently, with its purchase of 1901 Picture, which doubled the size of its content catalog.

Like Cinedigm, Chicken Soup for the Soul is running in the red as it scales up operations. However, if AMC decided to buy both these companies, it may be able to cobble together a profitable streaming unit in a short span of time.

With a $176.58 million market capitalization, buying all outstanding CSSE stock is something AMC could accomplish with its current cash position.

Meme Deals: Genius Brands (GNUS)

a kid laying on a floor playing with a tablet instead of toy cars that sit next to him
Source: patat / Shutterstock.com

Genius Brands (NASDAQ:GNUS) is another streaming play AMC could consider buying. Although, with a $316 million market capitalization, it would be a tougher pill to swallow.

Still, purchasing this company would get AMC into streaming. Genius produces children’s entertainment, as well as streams it through its Kartoon Channel platform.

If it chose to buy Genius, it could offer shares along with cash to make the deal. At below $1 per share, GNUS stock has fallen far from its past high. Current shareholders may be open to a buyout offer.

Admittedly, this isn’t the best potential target out there for AMC. Yet given Adam Aron’s talents in selling high-concept ideas to his shareholders he may be able to get AMC’s legion of self-described “Apes” (big fans of the stock) to respond positively to the news.

IDW Media Holdings (IDW)

A city skyline from the point of view of a man driving a flying car.
Source: Shutterstock

Primarily a small publisher of comic books and graphic novels, much of the excitement with IDW Media Holdings (NYSE:IDW) has been with its entertainment unit. More recently, though, the hype has faded considerably.

IDW stock has tanked since its uplisting on the New York Stock Exchange last summer. But now at bargain-basement prices, this is another inexpensive deal for AMC to pursue.

AMC could pump hundreds of millions into it, expanding its content output and enabling IDW to become profitable. After seeing its stock price surge from its success screening popular comic movies in its theaters, the next step may be to find success producing/screening comic book franchises it owns outright.

Sure, IDW is no DC Comics or Marvel. Even so, this is a potential deal that wouldn’t cost AMC much. At the same time, it has many of the ingredients needed to excite the meme crowd.


Image of the Playboy (PLBY) logo at the company's Westwood, California headquarters.
Source: Alex Millauer / Shutterstock.com

PLBY Group (NASDAQ:PLBY), which owns the rights to the Playboy bunny-ears trademark, primarily generates revenue from licensing this famed logo, as well as from the sale of adult products.

PLBY stock itself became a meme stock in 2021. Largely, due to its move into hot “Web3” areas like non-fungible tokens (NFTs) and the metaverse.

At today’s prices, it’s given back a large chunk of its meme gains. With this big price decline, the company may be cheap enough for AMC to acquire.

Yes, it’s pricier (market cap of $548.5 million) than the potential meme targets listed above. However, buying such a high-profile brand that has a Web3 connection to boot could go a long way in getting the meme crowd stampeding back into shares.

Meme Deals: Super League Gaming (SLGG)

cloud gaming: Gamer Playing and Winning in First-Person Shooter Online Video Game on His Personal Computer
Source: Gorodenkoff / Shutterstock.com

We’ve looked at all sorts of potential deals AMC could pursue, yet a metaverse-themed one may provide it with the best bang for its buck. Super League Gaming (NASDAQ:SLGG), which has pivoted from being an esports company to a company that operates/monetizes virtual worlds, would be an easy way for it to transform itself into a metaverse play.

SLGG stock currently has a market capitalization of around $70 million. Even at a 100% premium ($140 million), AMC would be using less than 10% of its cash position to buy it.

AMC could put more of its capital to work expanding this business. In turn, becoming a major player in the metaverse space.

Although “meta mania” have dropped in popularity since last fall, this trend isn’t likely to go away completely. Taking advantage of this lull to scoop up metaverse names could pay off in the years ahead.

On the date of publication, Thomas Niel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Thomas Niel, contributor for InvestorPlace.com, has been writing single-stock analysis for web-based publications since 2016.

Article printed from InvestorPlace Media, https://investorplace.com/2022/04/7-meme-deals-amc-should-consider-during-its-next-bargain-hunt/.

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