Shares of Kansas City-area companies took a beating as U.S. markets took a dive Monday amid investor anxiety over the spread of the coronavirus and a surge of infections in South Korea and Italy.
Stock markets in the United States fell more than 3.5%, the sharpest drop in nearly 14 months, as fears mounted that the virus will continue its spread around the world and threaten the global economy.
Leawood-based AMC Entertainment Holdings, the largest movie theater chain in the world, was particularly hard hit, its shares declining 5.5% and closing at $7.05.
The company's share price has been trending downward over the last three years as streaming services eat away at movie attendance figures and movie studio giants like Disney squeeze ticket revenue. But the additional prospect that governments might force public venues like theaters to shut down in order to halt the spread of the virus may have contributed to a further dampening of AMC’s fortunes.
“Anywhere you have a large congregation of people under a roof in times like this, those businesses are going to suffer,” said Vic Bodney, a financial planner in Leawood, Kansas. “Whether it’s legislated or whether people just say, ‘Hey, it’s too dangerous to do that.’”
AMC does not operate movie theaters in China, where the coronavirus originated and 77,000 people have been infected, but it does operate theaters in Europe, including Italy. The company's biggest shareholder is Dalia Wanda Group, a Chinese conglomerate, which owns about 38 percent of AMC.
AMC did not immediately respond to a request for comment.
Since the beginning of 2017, AMC has lost close to $3 billion in market capitalization as its stock has plummeted around 75%. The company is expected to report earnings for the fiscal quarter ending December 2019 after the market closes on Thursday.
As of Monday, the Centers for Disease Control & Prevention reported 14 confirmed cases of coronavirus disease, which has been given the official name COVID-19, in the United States, although it says it is not currently spreading.
“The question really becomes, 'Is the coronavirus going to be that bad for global business?'” Bodney said. "And the short answer is: It’s definitely going to be bad. The real issue is, is this going to be a pandemic or just a widespread outbreak and, more importantly, will it be contained in the places where it’s most rampant?”
Although AMC was the Kansas City-area company whose stock was hit hardest Monday, shares of other publicly traded companies based in the metro didn’t fare well either. Among them:
- Sprint Corp., -2.29%
- Cerner Corp., -3.54%
- YRC Worldwide Inc., -0.44%
- Garmin Ltd., -1.26%
- H&R Block Inc., -2.51%
- Kansas City Southern, -3.96%
- Euronet Worldwide Inc., -1.68%
- Commerce Bancshares Inc., -2.45%
- UMB Financial Corp., -3.31%
Dan Margolies is a reporter and editor for KCUR.
