July 26, 2018
Helios and Matheson Analytics CEO Ted Farnsworth claims Wall Street understands the firm’s MoviePass business model enabling subscribers to go to the movies daily for a $9.95 monthly fee.
Investors apparently think otherwise, sending HMNY shares down more than 85% at the market close July 26 – and 48 hours since the company engineered a 1-for-250 shares reverse-stock split to avoid having its stock delisted by Nasdaq.
The company’s market capitalization hovers around $7.4 million, while operating a business that spent $21 million monthly in the most-recent fiscal quarter paying exhibitors face value for every ticket consumed by its more than 3 million subscribers.
At the stock’s present rate of freefall, shares will again fall below the $1 minimum in less than two weeks.
“I think [HMNY] has been roundly ridiculed [by Wall Street] since it bought MoviePass and cut the [subscription] price below cost,” Wedbush Securities media analyst Michael Pachter said in an email.