America Mobile Plummets 3.4%: Regulatory Woes and Short-Sellers Drive Sharp Selloff

Summary
• America Mobile (AMX) trades at $22.29, down 3.42% intraday after opening at $22.835
• Short interest surges 52.2% in May, with 15.86M shares sold short
• Mexican regulator fines Telcel $93M for monopolistic practices
• Fitch upgrades AMX credit rating to stable, but shares remain pressured

AMX’s sharp intraday decline reflects a confluence of regulatory headwinds, short-seller aggression, and mixed analyst sentiment. Despite a 11.5% dividend increase and a stable credit rating from Fitch, the stock is trading near its 52-week low of $13.10. With short interest at 0.5% of float and a bearish RSI of 46.33, the selloff appears driven by both fundamental and technical factors.

Regulatory Fine and Short-Seller Pressure Trigger AMX's Intraday Slide
The Mexican telecoms regulator’s $93 million fine against Telcel for monopolistic practices has intensified investor caution, compounding existing short-term volatility. This penalty, coupled with a 52.2% surge in short interest to 15.86 million shares in May, has created a self-reinforcing bearish dynamic. Short sellers, now representing 0.5% of the float, are likely exacerbating the decline through covering activity as the stock approaches key support levels. Meanwhile, Fitch’s recent stable rating upgrade has failed to offset near-term concerns, with analysts at Wall Street Zen downgrading the stock to 'hold' and UBS cutting its rating to 'neutral'.

Wireless Sector Suffers as Verizon Drags, AMX Underperforming
The Wireless Telecommunication Services sector is broadly under pressure, with sector leader Verizon (VZ) down 0.91% intraday. However, AMX’s 3.42% drop outpaces the sector’s average decline, reflecting its unique regulatory and short-interest challenges. While Verizon’s recent job cuts and strategic reorientations have sparked sector-wide jitters, AMX’s selloff is more directly tied to its Mexican operations and short-covering dynamics. The sector’s mixed fundamentals—ranging from AT&T’s 5G advancements to T-Mobile’s satellite partnerships—highlight divergent investor priorities.

Bearish Setup: AMX20251219P22 and AMX20251219C23 for Volatility Play
• 200-day MA: $18.27 (well below current price)
• RSI: 46.33 (bearish momentum)
• Bollinger Bands: $22.54 (lower band) vs. $23.58 (upper band)
• MACD: 0.2423 (bearish crossover with signal line at 0.3371)

AMX is in a short-term bearish trend but remains above its 200-day MA, suggesting a potential rebound. Key support at $22.54 (lower Bollinger Band) and resistance at $23.06 (middle Bollinger Band) define the immediate trading range. The 30-day MA at $22.93 and 100-day MA at $20.54 indicate a long-term bullish bias, but near-term volatility is likely to persist.

Top Options:
• AMX20251219P22 (Put): Strike $22, Expiry 12/19, IV 24.39%, Leverage 63.70%, Delta -0.3883, Theta -0.004296, Gamma 0.308558, Turnover 35
- IV: Moderate volatility (24.39%)
- Leverage: High (63.70%)
- Delta: Strong bearish sensitivity (-0.3883)
- Theta: Low time decay (-0.004296)
- Gamma: High sensitivity to price movement (0.308558)
- Payoff: $0.71 per share if AMX drops 5% to $21.18
- Why: This put offers high leverage and gamma, ideal for a 5% downside scenario.

• AMX20251219C23 (Call): Strike $23, Expiry 12/19, IV 25.39%, Leverage 89.18%, Delta 0.3104, Theta -0.017429, Gamma 0.273078, Turnover 420
- IV: Moderate volatility (25.39%)
- Leverage: Very high (89.18%)
- Delta: Moderate bullish sensitivity (0.3104)
- Theta: High time decay (-0.017429)
- Gamma: Strong sensitivity to price movement (0.273078)
- Payoff: $0.82 per share if AMX rebounds to $23.00
- Why: High leverage and gamma make this call suitable for a rebound above $23.00.

Trading View: Aggressive bears should target the AMX20251219P22 put if the stock breaks below $22.54. Bulls may consider the AMX20251219C23 call into a bounce above $23.00, but watch for theta decay as time passes.

Backtest America Mobile Stock Performance
Below is the interactive event-backtest module. You can inspect the cumulative performance of América Móvil (AMX.N) after every –3 % (or worse) close-to-close plunge since 2022, including win-rate, excess returns vs. benchmark, and optimal holding horizon.Key take-aways (high-level):• 36 qualifying down-days were identified. • Short-term (1-5 day) returns are statistically neutral; no clear edge. • From day 22 onward, excess returns turn significantly positive, peaking near +4 % around trading day 25-28. • Win-rate rises above 60 % after ~25 trading days.Implications: the stock tends to mean-revert over a 1-month horizon after sharp daily sell-offs, but there is little evidence of an immediate bounce. Consider staggered entries or longer holding windows if exploiting this pattern.

Bullish Long-Term Outlook, But Short-Term Volatility Looms
AMX’s long-term fundamentals remain intact, with a 3% dividend yield and Fitch’s stable rating providing a floor. However, the immediate technical setup—defined by a bearish RSI, short-term bearish trend, and elevated short interest—suggests continued volatility. Investors should monitor the $22.54 support level and the $23.06 resistance. With sector leader Verizon (VZ) down 0.91%, cross-sector correlations may amplify near-term swings. Action: Consider AMX20251219P22 for a 5% downside play or AMX20251219C23 for a rebound trade, but exit if the stock fails to break key levels.