Why Clover Health Stock Is Soaring Today
Shares of Clover Health Investments (NASDAQ: CLOV) were soaring 12% as of 11:32 a.m. EDT on Tuesday. The gain came after the company filed an amendment to a preliminary prospectus to issue additional Class B shares, which have more limited voting rights than Class A shares. This amendment acknowledged that the stock's recent momentum could be the result of a short squeeze.
Clover Health didn't just call attention in its prospectus amendment to "widespread speculation that our current trading price is the result of a short squeeze." The company also said that its share price "may rapidly decline." It even cautioned against investing in its Class B shares "unless you are prepared to incur the risk of losing all or a substantial portion of your investment."
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Source Fool.com
