Benzinga’s PreMarket Prep airs every morning from 8 a.m. to 9 a.m. ET. During this fast-paced and highly informative hour, traders and investors tune in to get the top news for the day, the catalysts behind these moves, and the corresponding price action for the upcoming session.
Each day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick as well as producer Spencer Israel.
While many financial sector issues did not participate in Wednesday’s rally, one industry issue is having a good day. This problem is Carver Bancorp Inc (NASDAQ: CARV), the pre-market prep stock of the day.
The company: Carver Bancorp is a holding company and operates as a unitary savings and credit holding company, and the business of the company is the operation of its subsidiary.
Long-time loser: Either way, on a relative performance basis, this stock is a ‘pig’.
Throughout its terrible price history it has undergone a number of reverse stock splits, which is usually a bad thing for a long-term business. Following the splits, its all-time high was reached in December 2003 at $ 397.50.
its most recent reverse split was on June 15, a 1 to 15 split of its shares. The issue is now lower than today’s close, which was $ 15.18, to illustrate the negative effect of the split at least in the short term.
The reasons for the sudden Carver Bancorp rallies: Don’t oversimplify the price action on the show, but for the most part, this is a short squeeze goal.
On Tuesday, the show had a high short interest rate of 68%, but not such a high short interest ratio (0.7 coverage days). Either way, the high percentage makes it prone to cutbacks.
Being a black-owned business, the issue sparked investor interest around the June 15 vacation.
In that sense, the show peaked at $ 19.21, its highest level since last June, when it hit $ 22.97 in the week leading up to this year’s vacation.
Recent Carver Bancorp Price Action: On June 28, on short squeeze, Carver Bancorp climbed to $ 14.50 and fell back to end the session at $ 12.70.
On Tuesday it was approaching its June 22 low but found buyers at $ 9.74 and moved from there to $ 9.80.
It was the weakest day of the issue since June 23 (174,000) and traded at 417,000, while its five-day average volume is 1.43 million.
Lack of sellers: The show posting its lowest close since June 2 ($ 9.90) on very low volume and lack of follow-through beyond Tuesday’s low as the combination of short sellers trying to hedge and aggressive buyers sparked a rally.
As of 2:30 p.m. EST, the price action had followed the previous script. The open rally ended before 1 p.m., when it peaked at $ 12.63 and reversed course. That high coincided with its June 28 close at $ 12.70.
Since hitting that intraday high, it has gone down. The stock ended Wednesday’s session up 7.96% to $ 10.58.