Key Tronic Stock Trading Soars Upgraded Rating, Buying By Big Investor Contribute To Stock’s Rise
Trading in Key Tronic Corp. stock exploded Tuesday and Wednesday, lifting volume to 20 times normal and price to levels unseen since the mid-1980s.
The stock, which trades on the NASDAQ national over-the-counter market, closed at $13.63 Wednesday, up 75 cents and a new 52-week high. The price had been as high as $15.25 earlier in the day.
Monday, the stock had closed at $11.88. Key Tronic has not traded above $15 since 1986.
Volume skyrocketed. On average, about 36,000 Key Tronic shares would trade each day.
From 14,200 Monday, volume boomed to 350,400 Tuesday, then 618,500 Wednesday.
There were two apparent explanations for the burst of activity.
On Monday, an unidentified investor or investment group filed documents with the U.S. Securities and Exchange Commission indicating they were buying more than 5 percent of outstanding Key Tronic stock.
The type of filing, a 13-G, indicates the stock would be purchased for investment purposes only.
Although the investor’s identity could not be determined Wednesday, NASD spokesman Cameron Brown reported that the exchange recorded 38 large trades involving more than 333,000 shares of Key Tronic stock, most of those through the firm of PaineWebber.
Key Tronic Vice President Ron Klawitter said he did not know who the buyer was, adding that he was also unaware of the SEC filing.
Klawitter said some of the stock activity could be due to a reassessment of the company by San Francisco-based analyst Thomas Friedberg, who Tuesday upgraded his rating on Key Tronic stock from hold to buy.
Friedberg told the Dow Jones News Service that unique keyboards the company has begun making for IBM and Microsoft in recent months have moved it away from more generic, lower-priced models.
The Microsoft keyboard is shaped to alleviate stress on wrist and finger joints. For IBM, Key Tronic developed a keypad that expands when the company’s laptop computer is opened.
Friedberg, who is with Genesis Merchant Group Securities, also raised his earnings estimates for Key Tronic.