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: AMC’s new free popcorn for retail investors plan is just latest move by increasingly flirty meme stock execs

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The flirtatious dance between executives at “meme stock” companies and the retail traders who have fueled their meteoric rise has been a months-long chaste waltz, carefully designed to maintain the mutual attraction without offending the Securities and Exchange Commission.

But AMC Entertainment
AMC,
+71.60%

chief executive Adam Aron looks ready to crank up the music and start dancing a tango with the Reddit crowd.

After watching its stock soar more than 200% in May, thanks in large part to retail investors who the company now believes own more than 80% of its shares, AMC announced Wednesday that it will launch an initiative designed to put the theater chain in direct communication with its “extraordinary base of enthusiastic and passionate individual shareholders,” offering them everything from discount tickets to private missives from Aron himself to free snacks.

“We intend to communicate often with these investors, and from time to time provide them with special benefits at our theatres,” said Aron in a statement announcing the launch. “We start with a free large popcorn on us, when they attend their first movie at an AMC theatre this summer.”

But this initiative, while the least subtle, is just the latest in a series of actions that Aron and other meme stock executives have taken in recent months to tacitly acknowledge that retail investors are the ones buttering their popcorn.

Ryan Cohen, the Chewy
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+2.97%

co-founder and private equity investor who is set to become chairman of GameStop’s
GME,
+5.81%

board in June, has become the face of that company’s stock market surge and a folk hero on social media where a devout army of GameStop investors has turned January’s short squeeze on the stock into its own brand of value trade with Cohen’s leadership at the center of their investment thesis.

To burnish that image Cohen has used his Twitter account to post ambiguous imagery and risqué .gifs designed to titillate his followers and GameStop shareholders who have made an investment strategy out of interpreting Cohen’s missive.

Cohen has had help from outside the company as well. Retail investor and social media folk hero Keith Gill, aka The Roaring Kitty, aka DeepF-ckingValue, has also used obtuse memes on social media platforms to play a key role in the more than 1,360% rise in GameStop stock in 2021 so far.

And AMC’s Aron chose to accompany a Tuesday press release announcing AMC’s deal to sell 8.5 million shares of its common stock for $230.5 million to hedge fund Mudrick Capital Management with a Tweetstorm addressed directly to AMC’s retail investors that promoted the move as “playing offense” and “not mindless dilution” of the stock.

Those tweets looked prescient by the end of the trading day when it was reported that Mudrick had dumped its entire AMC stake after deeming it as “overvalued,” and yet still managed to make a tidy profit thanks to AMC’s loyal investor base who bought up the shares, sending AMC up more than 22%.

Cohen, Gill and Aron look like they are borrowing a page from the Elon Musk playbook, but they have also appeared to learn a thing or two from Musk’s missteps.

Musk pioneered the use of bizarre social media behavior to fascinate his fans and Tesla
TSLA,
-3.33%

investors but ran afoul of the SEC in 2018 after a series of tweets that got a little too explicit about his plans for his publicly-traded electric car company, resulting in a $20 million fine, his resignation as chairman, and an agreement to appoint executives to make sure the billionaire industrialist playboy behaved himself on Twitter. 

In recent months Musk has pivoted to using his social media influence to pump the price of the crypto currency Dogecoin
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+21.51%
,
but the SEC has been paying attention. On Wednesday morning, the Wall Street Journal reported that the regulator has informed Tesla that Musk’s recent use of Twitter has violated the court-ordered agreement from 2018.

In this new context of shareholder engagement, AMC’s new initiative might appear bold or even “thirsty” to younger investors, but it also claims to be something of a middle ground between performatively edgy tweets and outright provocation of regulators.

It is also something of a hit with its target audience who have made #AMCArmy a trending hashtag on Twitter and are taking to Reddit boards to praise Aron but remind him with avuncular clarity that they while they like free stuff, they have an investment to protect.

“This is bullsh-t!,” posted Measurement_Kooky on r/AMCstock. “I want to pay for that f-cking popcorn, you won’t stop me.”

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