Whatever’s happened to Kodak shares over the past month-plus, one’s things very clear: None of them had anything to do with fundamentals. First it was rumor. Then it was Peter Navarro. All along, it was powered by day traders who know the name “Kodak,” saw it was going up and gave into their crippling FOMO. Indeed, Kodak’s fundamentals remain exactly the same or worse today than they were before some self-serving and eventually untrue whispers about something that would “change the course of history for Rochester and the American people” began to emanate from Kodak’s press office.
And yet, Kodak shares nearly jumped back into the double digits yesterday. What gives?
The company disclosed that D.E. Shaw & Co. has taken a 5.2% stake in the company. Kodak said in filing with the Securities and Exchange Commission that D.E. Shaw has amassed 3.94 million shares of its stock.
Oh. Those aren’t bored gamblers or brain-dead Stoolies. Those guys are pretty smart, if weird and allegedly a little gross. Maybe there is something in Kodak’s fundamentals that justify its uneven but still quite impressive 141% rise over the past three months?
D.E. Shaw is a quantitative trading firm meaning the stocks they buy and sell are not necessarily aligned with the company’s long-term view of a particular stock. In other words, their new position could simply be a short-term trading bet.
Resume your stupid trading!