AMC jumps on report Amazon exploring potential acquisition (updated)
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 Updated: AMC Entertainment stock (NYSE:AMC) was up 10% shortly before Tuesday's market close, after paring its biggest gains of the day following a report that Amazon.com (NASDAQ:AMZN) is exploring an acquisition of the beleaguered movie-theater chain.
The stock had risen as high as a 21% gain.
Amazon founder Jeff Bezos has organized his entertainment lieutenants and investment advisers to consider such an acquisition, according to a report from The Intersect citing senior sources.
In such a plan, AMC's hundreds of theaters would be used for a number of purposes, including promoting Amazon Prime's original films for awards consideration but also cross-selling grocery delivery and even serving as product distribution hubs.
AMC (AMC) has a market capitalization of about $2.6B after Tuesday's jump; the stock has slid nearly 72% over the past year. But Bezos might just wait and watch in case the stock continues to erode, or jump on a potential bankruptcy, according to the report.
Wedbush Securities, for one firm, is skeptical. "Amazon would be better off buying a piece of Cineworld (OTCPK:CNNWQ)," analyst Alicia Reese noted, referring to the bankrupt UK-based owner of Regal Cinemas, America's second-largest theater chain. A hefty $4.6B in net debt and inflated valuation makes AMC an unlikely acquisition target in general, she said.