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Why Kodak Stock Gains Over 1500%, Why You Should be Careful

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Kodak Stock Jumps Over 1500%, Here is Why You Should be Careful

Shares of Kodak jumped more than 1,500 percent in the last four days following approval of $765 million loan by the US government to the former photography industry leader to start manufacturing pharmaceutical products.

While the move by Donald Trump-led administration was to make U.S self-sufficient in pharmaceutical drugs and reduce U.S. reliance on foreign sources that were almost grounded by COVID-19 pandemic, the relatively affordable value of Kodak stock was what boosted its attractiveness among retail investors that jumped on it through various trading apps like Robinhood.

Kodak opened at $2.15 per share on Monday and quickly rose by over 500 percent on Tuesday after Jim Continenza, the Chief Executive Officer, Kodak, made the loan approval public.

This continues until Thursday morning when the stock hit $41.48. Gaining more than 1,500 percent with market capitalisation hitting as high as $1.75 billion from less than $115 million it opened the week.

Kodak

Therefore, the stock value rose based on the news and affordability alone without any known product or strong fundamentals in an industry where a failed trial can derail any hype.

This was similar to what happened earlier in the year when the stock of Hertz jumped to unpredictable highs despite the company filing Chapter 11. Retail investors jumped on the stock after report of its bankruptcy plummeted its value, making it affordable to retail investors that kept jumping on it via various trading apps and eventually drove the price of a dying company to a record high.

The stock eventually crashed from $20.29 per share to $1.48 per share as at the time of writing.

Hertz

At Investors King we believe a similar thing is playing out with Kodak for several reasons, Kodak has no known pharmaceutical product or history with pharmaceutical products rather the struggling photography company is looking to take advantage of unrestrained funds going into the health sector given global pandemic.

While this could eventually work out, Kodak presently lacks the pedigree or necessary tools to compete with top American pharmaceutical companies working hard to address various COVID-19 challenges.

Kodak pix 2

Also, it would take several months or more than a year before Kodak hit the market with any pharmaceutical products. For those Nigerians, using apps to trade American stocks, Egungun be careful o!.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial market.

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PZ Cussons Begs for Extension to File Financial Results, Blames COVID-19

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PZ Cussons Blames COVID-19 for Failing to File for Financial Statements

PZ Cussons Nigeria Plc has informed the Nigerian Stock Exchange of its inability to file its audited financial statements for the period ended March 31, 2020.

In the statement signed by Jacqueline Ezeokwelume, Company Secretary/Legal Adviser and released by the company, the COVID-19 lockdown affected the company as certain unforeseen situations impacted its activities, including filing its financial results expected on or before the 29 August 2020 deadline.

It stated “We hereby inform The Nigerian Stock Exchange (‘The NSE) and the investing public that due to circumstances occasioned by the COVID-19 lockdown which although has gradually been eased, there were and still exist unforeseen circumstances that have made it impossible for the Company to comply with the timeline to file its Audited Financial Statements for the period ended May 31, 2020 by the due date of 29 August 2020.

“This is as a result of our annual interim audit process, which often starts in March/April which suffered some setback due to the complete lockdown imposed to contain the spread of COVID-19 at the time.

“Although we have made significant progress following the ease of lockdown in subsequent months, it has become apparent that it would not be possible to completely recover the lost time in the audit process. We are in the process of concluding the audit and will file the accounts by 29 September 2020.”

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Nigerian Stock Exchange Closes the Week Strong, Gains N181 Billion

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Nigerian Stock Exchange Gained N181 Billion This Week

The Nigerian Stock Exchange gained for five consecutive days this week to close the week strong. This is coming amid mixed second-quarter earnings reports from various listed companies.

The Exchange gained N181 billion or 1.41 percent from N12.882 trillion it closed last week before the Sallah holiday to N13.063 trillion this week. While the market capitalisation of listed stocks expanded by 1.41 percent or 348.16 basis points from 24,693.7 bps it closed last week to 25,041.89 bps this week.

During the week, investors traded 1.065 billion shares valued at N10.798 billion in 20,482 transactions, more than the 421.984 million shares valued at N5.337 billion that were traded in 11,801 deals in the previous week.

The sectoral analysis showed the Financial Services sector led in terms of volume traded with 677.301 million shares worth N5.070 billion in 10,386 deals. Therefore, contributing 63.59 percent and 46.95 percent to the total volume traded for the week.

This was followed by the Conglomerates sector with 153.384 million shares worth N580.216 million exchanged in 894 transactions. Industrial Good sector came third with 57.404 million shares valued at N861.263 million traded in 1,671 deals.

In terms of the most traded equities, FBN Holdings Plc, UACN Plc and Access Bank Plc led with a combined 320.196 million shares worth N1.802 billion in 2,639 deals. The three contributed 30.06 percent and 16.69 percent to the total equity turnover volume and value, respectively.

A break down of the week turnover revealed that investors traded 186,481,739 shares valued at N1,309,755,694 in 4,718 transactions on Monday. On Tuesday, a total turnover of 154,467,244 shares worth N1,457,531,880 was exchanged in 4,222 deals.

Investors traded 383,289,488, 173,748,425, and 167,139,054 shares valued at N3,892,572,516, N2,132,848,753 and N2,005,566,396 in 3,860 deals, 3,646 deals and 4,036 deals on Wednesday, Thursday and Friday, respectively.

So far this quarter, the bourse has gained 2.30 percent to moderate the year-to-date decline to 6.71 percent.

top gainers

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NSE Market Value Hits N13 Trillion After 4 Consecutive Days of Gains

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Nigerian Stock Market Capitalisation Hits N13 Trillion on Thursday

The Nigerian Stock Exchange hits N13 trillion on Thursday following four consecutive days of gains.

The market capitalisation of listed equities rose by N21 billion from N12.979 trillion it closed on Wednesday to N13 trillion on Thursday.

The NSE All-Share Index gained 0.19 percent to 24,930.34 basis points, up from 24,882,04 bps.

Seplat Petroleum led top gainers with 9.03 percent to close at N350. Followed by Stanbic IBTC’s 4.76 percent to N33 per share.

MTN Nigeria, Guinness and NASCOn gained 0.42 percent, 3.85 percent and 4.17 percent to close settle at N118.5, N13.5 and 10 per share. See the details below.

Top Trades by Volume

Symbols Volume Value
FBNH 29,775,007 N150,248,861.25
GUARANTY 13,157,988 N312,617,278.10
CUSTODIAN 12,849,424 N64,247,356.00
TRANSCORP 10,749,932 N6,651,705.66
WAPCO 9,963,250 N116,627,159.95

Top Gainers

Symbols Last Close Current Change %Change
SEPLAT N321 N350 29 9.03%
STANBIC N31.5 N33 1.5 4.76%
MTNN N118 N118.5 0.5 0.42%
GUINNESS N13 N13.5 0.5 3.85%
NASCON N9.6 N10 0.4 4.17%

Top Losers

Symbols Last Close Current Change %Change
BUACEMENT N40.2 N39.5 -0.7 -1.74%
UBN N5.4 N5 -0.4 -7.41%
FLOURMILL N19.4 N19.2 -0.2 -1.03%
MAYBAKER N2.9 N2.8 -0.1 -3.45%
LEARNAFRCA N1.01 N0.94 -0.07 -6.93%

 

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