Shares of one of the country’s oldest and largest Black-owned financial institutions, Carver Bancorp (NASDAQ:CARV), are up more than 70% in Thursday’s pre-market trading. The move comes just days after a retail influencer highlighted the elevated short interest in CARV stock.
Gains on Wednesday reversed what have been mostly down days for the lender’s shares over the past month.
Will Meade, a former hedge fund manager with nearly 200,000 followers on Twitter (NYSE:TWTR), on June 28 pointed out that CARV stock was that day the most shorted stock on the market with a 68% short interest.
More than five times the average daily volume traded that day, with similar trading stats on Carver shares yesterday pushing the price up by 7.96%.
$CARV is now the most shorted stock trading trading with a whopping 68% short interest! Short sellers picking on Carver Bancorp, one of the largest African American owned banks. I’m long, let’s make shorts pay. pic.twitter.com/NQSaX3KwsT
— Will Meade (@realwillmeade) June 28, 2021
CARV Stock Too Small for r/WallStreetBets Chatter
Typically when we cover big pre-market moves in high short interest stocks, the usual suspects are chattering retail traders posting on Reddit’s r/WallStreetBets. But that’s not likely, as a bot on the subreddit warned earlier today that CARV stock doesn’t qualify for discussion there because its market capitalization is less than $1 billion.
However, the move and Meade’s short highlight was the focus of the subreddit dedicated to the bank’s shares, r/carvstock.
Of the 4,700 banks in the U.S. that hold a combined $20.3 trillion of assets, only 21 of them are Black-owned or led, and those have total assets of just $5 billion. CNBC reported.
Lenders like Carver have come into focus over the past year as an estimated $150 million in equity capital has been invested in Black-owned banks since George Floyd was murdered last year, according to the National Bankers Association, a trade group that represents 24 of the country’s minority-owned financial institutions, CNN Business reported last month.
Carver Bancorp, founded in 1948, is headquartered in Harlem, New York. The majority of its eight locations continue to serve customers in middle-to-low income areas. It was designated by the U.S. Treasury Department as a Community Development Financial Institutions (CDFI) for its “community-focused banking services and dedication to the economic viability and revitalization of underserved neighborhoods.”
CDFIs were among the biggest lenders in the final round of the federal government’s Paycheck Protection Program loans, making more than $34 billion in those loan this year.
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On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News and as a buyside equity research editor. His Substack newsletter, TLV Strategist, covers the Israel business scene.
