One of the big movers over the past week has been Harbor Custom Development (NASDAQ:HCDI). For the past five trading days, HCDI stock is up approximately 15% on some pretty heavy volume. Today, this trend has continued, despite rather bearish price action in the market.
Zooming out on Harbor Custom’s stock chart, however, the picture is less rosy. That’s because this real estate development company, like the broader sector, has been hit hard by various macro concerns.
As the Federal Reserve hikes interest rates, expectations for new home buying activity are starting to tumble. That’s because mortgage rates are directly impacted by higher overnight lending rates. As of yesterday, 30-year fixed mortgage rates for new home purchases are above 5.7%. Last year, many new mortgages and refinancings were taking place sub-3%. Higher mortgage rates mean higher payments, effectively pricing many new homebuyers out of the market.
This bearish macro view has invited short sellers to take a hard look at home builders like Harbor Custom Development. As InvestorPlace contributor Shrey Dua recently pointed out, that has put a lot of buzz around HCDI stock as a potential short squeeze candidate. This week the stock is second on Fintel’s short squeeze leaderboard.
So, let’s dive into a few things investors may want to know about Harbor Custom and its squeeze potential.
What to Know About HCDI Stock
- Harbor Custom Development is a real estate development company operating in the western United States.
- Incorporated in 2014, the company is based out of Gig Harbor, Washington.
- The company provides a range of real estate services to its clientele.
- These include land acquisition, development and the construction and management of various residential projects.
- Harbor Custom focuses on both single-family homes and multi-family projects, such as townhomes and condominiums or apartment sites.
- HCDI stock has traded in a range of $1.67 to $3.75 per share over the past 52 weeks.
- Currently, investors can pick up the stock at around $2.55, at the time of writing.
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On the date of publication, Chris MacDonald did not hold (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.