When news of the omicron variant of the Covid-19 flashed across global media headlines, plenty of folks got a sinking feeling. Early reports suggested that the new strain featured high transmissibility — and that still appears to be the case. Therefore, it wasn’t surprising that AMC Entertainment (NYSE:AMC) suffered some red ink. Being in close quarters in a movie theater is not necessarily ideal during a resurgent pandemic, posing concerns for AMC stock.

However, as health experts parse through the limited data, a consensus is starting to arise. As the Washington Post reported, the World Health Organization believes “omicron presents a rapid increase in transmission but the variant causes milder cases of Covid-19 than delta, which is still spreading across the globe.” That’s brilliant news for high-contact businesses.

Now, before you go out and buy AMC stock, be careful. Experts stress that we’re still in the early innings and thus it’s premature to paint a conclusive picture about omicron. Nevertheless, the declarations coming from major trusted sources — well, I guess that depends on whom you ask — and present a much more encouraging tone than we’ve seen recently.

To be sure, the broader market appears to have set aside its worries, with AMC stock jumping over 4% during the midweek session. Further, optimists have justification for their bullishness in cineplex-based investments. Thanks to retail revenge or the collective opening of wallets to make up for the lost experiences in 2020, consumers are eager to reclaim their daily lives.

We’re also seeing packed stadiums for various sports leagues, suggesting that omicron or no omicron, the people have spoken. They are tired of the facemasks, the mitigation protocols, the social distancing and everything else that comes with a pandemic. Again, this seemingly plays into AMC’s hands.

Age Distribution Poses a Wild Card for AMC Stock

Many people who lean toward the right of the political spectrum might find a recent CNN Business report to be ironic. It asked whether the press overhyped the dangers that the omicron variant posed. Long story short, the author concluded that the tone of news coverage matters. For instance, if the worst-case scenario doesn’t pan out, that could negatively affect credibility.

I agree, which is why I made sure when covering omicron-themed topics, that I presented both the concerns and existing counterbalancing points. Still, just because omicron may impose less severe symptoms does not necessarily spell a positive catalyst for AMC stock.

For one thing, Covid-19 cases are still elevated in the U.S. Even without concerns about omicron, the winter weather places challenges on addressing the pandemic. Also, delta remains a threat, meaning  it’s no time to relax our vigilance.

But as it specifically relates to AMC stock, the underlying industry’s consumer age distribution of frequent moviegoers may present obstacles to the recovery. Initially, it might not seem that way. From 2017 through 2019, the biggest age bracket by far is the 25-to-39 years category. Since these folks are around the prime of their lives, omicron shouldn’t be a big deal to them.

However, take out the aforementioned bracket and you have a generally even distribution across various age brackets. That’s possibly problematic for two reasons. Number one: in 2019, the 50-to- 59 and 60-plus segments represented 4.2% and 5.5% of frequent moviegoers, respectively. These folks might decide to stay in for their own safety.

Then you have the Generation Z (Gen Z) demo among adults 18-to-24 years. In 2019, this category represented 5.4% of frequent moviegoers, even less than the 60-plus crowd. That’s another challenge because Gen Z has so many home-entertainment options available.

Watch the $35 Level

As someone who has mostly exited out of AMC stock and is thus only playing with house money, I’m not anxious about where shares might head next. I’m just presenting some factors to consider that may not have crossed your radar.

If you’re bullish on the cineplex operator, you might dismiss my concerns and that’s totally fine. However, I can’t help but notice that since July of this year, AMC stock has printed a distinct trend line approximately between the $35 and $36 level: in some cases, this level imposed resistance while in other cases, it provided support.

As I write this, AMC stock closed at $32.35. That’s in a technical no-man’s-land as far as I’m concerned, since the next logical support line down would be around $10. Based on recent history, , I’d like to see AMC hit $35 quickly and rise above. Otherwise, there’s real risk lingering in a precarious situation.

On the date of publication, Josh Enomoto held a LONG position in AMC. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.