Whoever shorted Kodak is raking in the dough right now.
After skyrocketing from a buck to as high as $60 in intraday trading last week, Kodak shares are cratered. The stock fell to below $10, although it has pared some of those losses on Monday.
At the time of this writing, Kodak is down 28 percent to just under $11.
What happened? The U.S. government is blocking a $765 million loan to the company, funds that were supposed to go to manufacturing drug ingredients for potential coronavirus vaccines. Reportedly, executives are accused of “wrongdoing.”
From Reuters:
The U.S. International Development Finance Corp (DFC) was slated to grant the loan to Eastman Kodak, which is looking to move deeper into the pharmaceutical arena.
But alarms were raised after senior Democratic lawmakers asked federal regulators to investigate securities transactions made by the company and its executives around the time it learned it could receive the government loan.
U.S. President Donald Trump said last week the government would investigate the circumstances surrounding the announcement of the loan.
“Recent allegations of wrongdoing raise serious concerns,” U.S. International Development Finance Corp (DFC) said late on Friday in a tweet.
The company’s shares have soared more than five-fold, with retail traders on the popular Robinhood trading app piling into the stock since DFC announced it would sign a letter of interest to provide the loan to the company.
Let’s hope the men in tights on Robinhood got out fast!
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