Eastman Kodak News: Why KODK Stock Is Soaring 25% Today

Eastman Kodak (NYSE:KODK) news for Tuesday includes a filing with the U.S. Securities and Exchange Commission (SEC) that has KODK stock heading higher.

two Kodak (KODK) branded photo rolls

Source: Rizhka Nazar / Shutterstock.com

The filing with the SEC reveals that hedge fund D. E. Shaw & Co. has acquired a 5.2% stake in Eastman Kodak. This saw the company purchase more than 3.94 million shares of KODK stock. The price it bought the shares for wasn’t disclosed in the SEC filing.

So why is D. E. Shaw & Co. making such a large investment in Eastman Kodak? It likely has to do with the company’s shifting focus away from photos and toward medicine. The company announced back in July that it would be making this change.

Eastman Kodak isn’t shifting to drug making on its own. It received a $765 million loan from the U.S. government to help it along the way. The goal is to have 30% to 40% of its business focused on drug making.

Unfortunately, the process hasn’t been smooth for Eastman Kodak. The company might have to deal with a class-action lawsuit from investors. That’s due to claims that several executives took out stock options for KODK stock and purchased shares ahead of announcing the $765 million government loan.

Even with a possible class-action lawsuit looming, Eastman Kodak is still seeing massive gains today on the D. E. Shaw & Co. stake news.

KODK stock was up 25.4% as of Tuesday afternoon and is up 48.4% since the start of the year.

On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Article printed from InvestorPlace Media, https://investorplace.com/2020/09/eastman-kodak-news-pushes-kodk-stock-higher/.

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