Why Is AMC Entertainment Tumbling Today?

Shares of AMC Entertainment (NYSE: AMC) are tumbling 7.2% at 10:41 a.m. ET on Friday after the company reported second-quarter earnings yesterday following the market close, but all anyone wanted to talk about was the special preferred stock dividend it will issue on a 1-for-1 basis.

The special dividend will be issued to shareholders of record as of Aug. 15 and paid on Aug. 19. It will trade under the ticker symbol APE, which technically refers to "AMC Preferred Equity," but is clearly also a nod to the investors who have carried the stock over the past year or so and who refer to themselves collectively as "apes."

There are several reasons AMC is issuing the preferred stock. Because the theater owner raised massive amounts of cash during the pandemic by issuing scads of new shares, it has tapped out its ability to raise more money in that fashion.

Source Fool.com