Insights

AMA Group (ASX:AMA) share price drops 6% following media criticism

The AMA share price is tumbling as media speculation surrounds its finances
The post AMA Group (ASX:AMA) share price drops 6% following media criticism appeared first on The Motley Fool Australia. –

The AMA Group Ltd (ASX: AMA) share price is in the red today after the company knocked back media criticism.

AMA has acknowledged an unnamed media outlet’s claims its business is in dire straits by pointing to its current capital structure review.

The company hopes its review will help it beat a massive $99 million dint in its bottom line, caused by the impact of COVID-19 and reported on in the company’s financial year 2021 earnings report.

AMA’s response hasn’t seemed to quell the market. Right now, the AMA share price is 42 cents, 5.62% lower than its previous close.

Let’s take a closer look at today’s news that could be impacting the automotive smash repair and parts supplier’s shares.

What’s weighing on the AMA share price?

The AMA share price is tumbling after it rebutted media reports.

While the company acknowledged a publication had questioned its capital position, it only repeated news already published within its financial year 2021 report.

While AMA didn’t name the publication speculating on its finances, the Australian Financial Review (AFR) did report on them last night.

And it may be the AFR’s reporting that’s weighing on the AMA share price today.

Within the AFR’s article, it noted AMA needs to restructure its debt before the end of the year – as the company previously announced.

However, the AFR reported the company is strapped for cash, a claim AMA hit back against. The AFR also claimed AMA’s lenders are concerned with the company’s annual report.

AMA’s response to media speculation stated its banking syndicate is supportive of its business. It also noted AMA’s directors are confident the capital structure review will result in positive findings. It said:

While the business is experiencing COVID-19 related repair volume decreases, these impacts are being actively managed. With $64 million in cash as at 30 June 2021 and a low level of net debt versus normalised earnings (pre-COVID-19 effects), the company’s liquidity position remains strong. The group’s insurer partners remain supportive, and we look forward to returning to normal operations as restrictions ease.

Unfortunately, AMA reiterating its confidence hasn’t been enough to save its share price today.

The post AMA Group (ASX:AMA) share price drops 6% following media criticism appeared first on The Motley Fool Australia.

Should you invest $1,000 in AMA Group right now?

Before you consider AMA Group, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and AMA Group wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

What shares are moving the ASX 200 on Friday?

The 92 Energy (ASX: 92E) share price is rocketing 44% today. Here’s why
Why the Metalstech (ASX:MTC) share price is rocketing 16% on Friday
ClearView Wealth (ASX:CVW) share price surges 15% on strategic review
Up 29% this week, the Boss Energy (ASX:BOE) share price is soaring again

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!