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KAVL Stock Alert: The Big News Sending Kaival Brands Soaring 25% Today

Since markets opened today, an usual name has been making waves among penny stocks. Kaival Brands (NASDAQ:KAVL) is a Florida-based company built around acquiring and developing vape brands. This morning saw KAVL stock shoot up by astounding amounts with share prices more than doubling. Although the stock has come down a bit since then, these types of gains are noteworthy. These gains are due to a recent announcement from the U.S. Food and Drug Administration (FDA) that should have investors quite pleased.

an array of various styles of vaping devices

Source: Shutterstock

What Happened With KAVL Stock

This morning saw KAVL stock skyrocket by as much as 90% in pre-market trading, after the company announced that the FDA had issued an administrative stay of a marketing denial order concerning a product of Kaival’s brand, Bidi Vapor.

While KAVL has declined since its early morning spike, it’s still up more than 20% for the day. For a relatively little-known penny stock, this is quite an impressive figure.

What It Means

Anyone paying attention last week, though, saw that KAVL doesn’t need media attention to gain momentum. Oct. 19 saw shares rise consistently after the stock caught the attention of retail traders, rising by more than 21% in pre-market trading. It seems social media communities have taken quite an interest in KAVL stock, leading to last week’s pump.

The company is still new, having only launched in 2019. In fact, it has only been trading on the Nasdaq since July 2021. While the stock may be slow to take off, it’s exactly the type that could garner meme stock status. Not only is it currently trading at very low levels, but the company deals in a vaping devices, a very popular area in which demand is growing as young consumers seek out alternatives to cigarettes.

Why It Matters

As of now, Kaival still has the advantage of operating in a field that many consumers know little about. Put another way, researchers are still determining what health impacts, if any, are associated with vaping. While there is the potential for blowback down the road, companies like Kaival have a real opportunity right now.

So where do things stand right now? Essentially, the originally issued marketing denial order means that the Bidi product failed to meet regulatory standards. As a result of the MDO, the brand would not be able to market its products. However, the stay means that Bidi can carry on with its business while regulators review further information. Hopefully for shareholders, Kaival uses this time wisely.

There’s plenty for investors to learn about this little-known company, but in the meantime, KAVL stock is one worth watching. Further volatility could be ahead.

On the date of publication, Samuel O’Brient 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 Publishing Guidelines.

With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that’s writers disclose this fact and warn readers of the risks. 

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