Cineworld (LON: CINE) share price is taking its final breaths as analysts expect the stock to be delisted soon. It will be one of the most brutal outcomes for the shareholders who are set to lose their investments. The firm has gone into administration, which will wipe out the shareholders.
For the past few days, the volatility in Cineworld stock has been significantly reduced. This suggests that investor interest in the stock has hit new lows as they are anticipating a delisting in the near future. On Tuesday, the shares were changing hands at 0.39p.
Cineworld applied for administration earlier this month. This means that the company’s stock will be delisted as soon as the administrators get appointed. This will wipe out the shareholders’ investment, who are set to receive nothing as per the recent restructuring plan.
Ahead of a potential delisting, Cineworld share price has hit its all-time low. Despite these critical developments, Cineworld cinema sites continue to operate normally. According to the latest reports, the firm has appointed Eduardo Acuna as its new CEO. He is a former executive at the Mexican theatre company Cinépolis.
At this point, it is almost foolish to dabble with LON: CINE as the stock may get delisted anytime. While this is a very painful scenario for the shareholders, there also lies a great lesson. Many people invested in Cineworld after its bankruptcy as the stock was very cheap. These investors tried to catch a falling knife which is almost never a good idea.
These investors were lured by the bullish Cineworld share price forecasts by some pseudo analysts who were predicting a recovery. Consequently, they are set to lose their investments as the firm is transferring its assets to another company which will also allow it to raise funds via debt financing.
Don’t let Cineworld share price action disappoint you, as there are still plenty of good plays in the market. I keep mentioning such opportunities on my Twitter, where you are welcome to follow me.
This post was last modified on %s = human-readable time difference 10:42