AMTD Idea (NYSE:AMTD) traded higher today before falling in the red. Shares of AMTD are currently down over 10%. The company was put in the spotlight after its subsidiary, AMTD Digital (NYSE:HKD), gained more than 30,000% following its initial public offering, or IPO. HKD was initially priced at $7.80 at its debut; today it trades in the $1,300 range with an all-time high price of $2,555.
So, what can explain the extreme share appreciation? Well, even AMTD Digital is a bit confused, stating:
“To our knowledge, there are no material circumstances, events nor other matters relating to our Company’s business and operating activities since the IPO date.”
In addition, AMTD Idea owns 97.1% of AMTD Digital’s shares outstanding as of July 15. Yahoo reports that there are 185.04 million shares of HKD outstanding, while the public float is only 19.05 million shares. As a result, the low float may be attributed to HKD’s price appreciation as retail investors bid up the price on low volume.
Another way to think about this is that HKD holders refused to sell, which in turn forced potential buyers to bid up the price. Last Tuesday, HKD traded above $2,500 on low volume of just more than 250,000 shares.
Meanwhile, HKD’s underwriters stand to gain massively. They have been granted a green-shoe option, which means they can exercise options to purchase 2.4 million shares at $7.80 apiece. The underwriters will be eligible to sell these shares on Aug. 15.
Meanwhile, AMTD has tagged along for the ride. Shares of the company are up more than 400% this month. With that in mind, let’s take a look at who is betting big on AMTD stock.
5 Investors Betting Big on AMTD Stock
AMTD is not very popular among institutional investors. Whale Wisdom reports that less than 10 own shares in the financial company. Let’s take a look at the top five investors:
- AMTD Group: 178.76 million shares. AMTD’s position is accurate as of Q4 2020. At the time, it sold 21.24 million shares.
- Calvin Choi, Founder and Chairman: 62.62 million shares. Choi’s position is accurate as of Q4 2020. Furthermore, Hong Kong security regulators are seeking to enforce a 2-year industry ban on Choi for “professional misconduct.”
- Century City: 21.84 million shares. Century’s position is accurate as of Q4 2021. During that time, it purchased 140,186 shares.
- Morgan Stanley (NYSE:MS): 1.28 million shares. Morgan Stanley sold 1,000 shares during Q1.
- Envestnet: 21,946 shares. Envestnet has already filed its Q2 13F form and purchased its entire stake during Q2.
On the date of publication, Eddie Pan 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.
