This does not look like the week to own shares of Eastman Kodak (NYSE:KODK).
Last week, the former photography giant that has now turned to producing pharmaceutical ingredients could do no wrong. Kodak stock nearly doubled on positive news that a team of lawyers (working for the company) who investigated possible wrongdoing surrounding a $765 million government loan had cleared Kodak of liability.
This week, however, with government investigations of the same situation still ongoing, Kodak shares are heading the other way, and were down 11.1% at 2:40 p.m. EDT today.
In fact, since the week began, Kodak stock is down a shocking 26% on essentially no hard news. And the absence of news could be the cause of Kodak’s decline this time.
After Kodak made its announcement of its lawyers’ conclusion, Congress seemed to rebut their findings, with the chairs of the House Select Subcommittee on the Coronavirus Crisis, the Committee on Financial Services, and the Committee on Oversight and Reform jointly complaining that “the report from Kodak’s lawyers raises more questions than it answers about the Trump Administration’s efforts to provide the company a $765 million loan to produce pharmaceutical ingredients despite Kodak’s lack of experience in the field.”
Ever since that rebuttal, Kodak has issued no response. After six days, the silence is starting to get ominous, and I suspect this is why investors are frightened and abandoning Kodak stock in droves today.