Eastman Kodak (NYSE: KODK) – Kodak had some very suspicious business activity before the drug news
Eastman Kodak Company (NYSE: KODK) shares climbed 222% on Tuesday after the company said it pivot towards the development of medicinal ingredients and announced a large government loan.
Benzinga Pre-marketing preparation Co-host Dennis Dick said on the Tuesday morning show that he noticed suspicious trading activity in the Kodak stock and options market on Monday before the news broke.
“All I want to know is who got the memo yesterday?” Watch the pop on this thing yesterday before the news. It’s a big candle. It’s the biggest upward movement he’s had in two months, ”Dick said.
What happened? Kodak shares were up 25% on Monday before the big news broke. Kodak’s historic business was producing cameras, but it has since evolved into blockchain and now plans to produce generic drug ingredients, the company said.
“I would see who was buying this thing yesterday.” If there has been any insider buying, it’s interesting that it’s that type of stock, which is basically trying to push the price up in my opinion, ”Dick said.
“Would I pursue this?” Absolutely not. I think when the dust settles, this thing will settle.
How to play it: Dick said Kodak’s stock price reacted similarly in 2017 when the company tried to jump into the blockchain trend on Wall Street. Despite huge short-term spikes on blockchain news, Kodak shares were still down around 80% in the past three years before this week’s explosive gains.
“I wouldn’t be chasing after $ 8 because I don’t know when the hot potato round will end, but I think you have to be careful of shortening it as well as these things can get crazy. It’s a tightening now, ”Dick said.
Kodak shares were trading around $ 8.44 per share at the time of publication.
Watch the full discussion in the clip below, or listen to the podcast here
PreMarket Prep is a daily trade show hosted by props trader Dennis Dick and former floor trader Joel Elconin. You can watch PreMarket Prep live every day from 8 a.m. to 9 a.m. ET Benzinga’s YouTube channel, and the podcast is activated Spotify, itunes, google play, Sound cloud, Stapler and To agree.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.